July 28 and the oil-contract migration: what is decided and who is racing
The reform’s 180-day clock closes on Tuesday and the hydrocarbons ministry said it will not move it. Migrating brings no new barrel: it aligns the tax terms of 26 joint ventures and 13 contracts to rates of 20% to 35%.
On Tuesday, July 28, the 180 days that January’s reform gave to rewrite PDVSA’s contracts under a new regime come due, and the hydrocarbons ministry told partners it will not extend it. Close to two dozen operators — Chevron, Repsol, Eni — are racing to sign before the date.
Clear up the original confusion: migrating produces no additional barrel and brings no new money; it aligns the tax terms of contracts that already exist to the rates the regulation set on July 7. What is at stake on Tuesday is not output, but how many of those accounts close at those rates.
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