Monday, June 14, 2010

Chavez Wants PDVSA's Name Changed To Something More Socialist

CARACAS (Dow Jones)--Venezuela President Hugo Chavez is considering changing the name of Petroleos de Venezuela S.A., or PDVSA, to something that reflects the state oil company's socialist component.

The "S.A." at the end of the name is an unnecessary term left over from the days of capitalism, said Chavez, a declared socialist who also sometimes calls himself of Marxist.

S.A. is used in the names of corporations in many countries, and it is directly translated as anonymous society or anonymous company, but is more commonly translated in English as a public limited company.

Speaking Sunday, Chavez said PDVSA should instead simply be called "Petroleos de Venezuela Socialista."

"Why should it be an 'anonymous society' if that is a remnant of the capitalist model?" Chavez said.

PDVSA was founded in 1975 with the nationalization of the oil industry, and bills itself at the world's fourth-largest integrated oil and gas company. PDVSA dominates the industry in Venezuela, one of the world's top oil exporters.

Chavez has increasingly used revenue from oil sales to fund social projects for the poor, siphoning off billions of dollars per year to the FONDEN development fund. Earlier this year, he had PDVSA employees take an oath to socialism.

Critics say, however, that Chavez' socialist policies and his use of PDVSA profits to fund pet social projects rather than to invest in new oil infrastructure could be slowly ruining the company.

Oil production in Venezuela is down significantly from a decade ago, and while PDVSA recently signed several joint ventures with foreign companies to drill new wells and increase output, the projects have been slow in getting started.

-By Dan Molinski, Dow Jones Newswires; 58-414-120-5738;

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