We’ll get started with this week’s Venezuela : Down The Rabbit Hole segment in just a bit but first…Argus Media reports that Chevron will operate the Propiar upgrader in it’s joint venture with PDVSA (Venezuela government-owned oil company), in which Chevron holds a 30% stake. It is the 1st time a foreign oil company has been allowed to operate an upgrader in Venezuela since Hugo Chavez nationalized the Venezuela energy industry in 2006-2007.
This is what was expected by energy analysts. Chevron will control management, administration, and operation of joint ventures with PDVSA even though they are minority shareholders. Sounds like the Chavistas may be willing to, at least for now, set aside their ideology and accept the reality that all enterprises, in all sectors of the Venezuelan economy controlled by the inept, corrupt Chavistas have failed. With the Chavistas in charge of the joint ventures Chevron’s output in Venezuela has declined from 100,000 bpd (barrels per day) in 2017 to about 29,000 bpd in Sept. and that’s even a little better than the overall production numbers under Chavista control which have declined from 3 and 1/2 million bpd to under 700,000 bpd (and they’ve been worse).
Then we have insight Crime with a piece that fit’s nicely with our Venezuela : Down The Rabbit Hole segment. The discovery of three mass graves in Venezuela’s Bolivar state in November points to how sinister the increase in disappearances in the country’s illegal mining epicenter has become.
These discoveries come months after Venezuela Commission for Human Rights and Citizenship reported that between September, 2021 – April, 2022 at least 37 people have gone missing in the area. Most of these people are likely dead according to the Venezuela Observatory of Violence. In their 2021 annual report they listed three of the top five most violent municipalities in Venezuela as being in Bolivar’s mining region.
In 2016 Nicolas Maduro created the “Mining Arc” and the government, specifically the military, would control the region and regulate mining. Instead, criminal gangs control everything and the corrupt Chavistas are content to profit from the exploitation of the people and the destruction of the environment.
Then we have Reuters telling us that PDVSA officials and Chevron executives plan to address workers in their joint ventures regarding new managers, maintenance work, and operational improvements. The meeting will take place at the Petropiar facility in Venezuela’s Orinoco Belt, the primary source of Venezuela’s extra-heavy crude, the largest proven reserves in the world. Chevron says it does not expect significant capital investment in the coming six months due to the license restrictions on proceeds from oil exports.
And we have BNN Bloomberg reporting that the mass exodus of Venezuelan migrants has an upside, that is if you’re a remittance company like Zelle or Airtm and others. 29% of Venezuelans receive remittances from the over 7 million Venezuelan migrants abroad and remittances back to their home country have doubled since 2018.
Then we have RFI with another positive sign for Venezuela. They report that Venezuela has revived Fashion Week after an absence of almost two decades. Designers who have dressed stars like Meryl Streep, Sandra Bullock, and Beyonce participated.
Venezuelans have long embraced personal appearance and personal care as evidenced by it’s myriad beauty pageants (numerous Miss Universe winners) and the fact that prior to Chavismo Venezuelans were the #1 consumers of personal care products in the world per capita. Anything even remotely resembling a return to normalcy in Venezuela is a welcome sight.
RFI also reports that in the last two months approximately 3,000 Russian tourists used the direct Moscow to Margarita Island flight. Maduro has predicted 100,000 Russian tourists to visit Venezuela by the end of the year. (We’re almost there so they better have a “bang-up” holiday season) Maduro says tourism is a “secret weapon” to revitalize the economy….Uhhh…OK.
Let’s go Down The Rabbit Hole…
Chapter 9/ El Dorado…
Chavismo has managed to destroy healthcare, the national oil company (once the envy of the entire oil-producing world), the power grid and access to fresh water, the currency (twice over and now we have another new one…), food security, transportation security, just about any business or industry you can name, and the hopes and dreams of an entire generation. In the interest of being an equal opportunity destroyer Maduro created the “Mining Arc” causing the rape of the environment and the simultaneous exploitation and slaughter of indigenous peoples. Since they destroyed basically everything else in the country they certainly couldn’t leave the environment and the indigenous peoples alone. It’s puzzling how an American company can let a few drops of oil hit the ground in western Nebraska or an American soldier could violate someone’s civil rights in Afghanistan and it’s all over the news and yet Maduro can poison the rivers and kill the Pemon people (and others) and the environmentalists and Human Rights groups (at least on the international level) are largely silent. Please, allow me to enlighten you.
As the economy collapsed around them many Venezuelans had to make a geographic change to survive. Millions left the country causing the largest migratory crisis in the history of the western hemisphere. For thousands of people unable, or unwilling, to leave the country they only knew they had to go somewhere, to do something. Similar to the American west in the 1800s the best option seemed to be to head to the mining region(s). For those who caused the collapse of everything, the Chavistas, this also seemed like a good idea. As we have seen previously, the Maduro regime, in it’s desperate search for money to pay the military and buy their continued loyalty, explored all options and exhausted all options. I’ve heard them compared to meth addicts who have already gone through all their money, sold everything they had of value, and then began destroying the house they lived in so they could sell the copper wiring in the walls and get what they could to buy themselves a little more time. A perfect analogy.
Southern and eastern Venezuela, the area bordering Guyana and Brazil, on the fringes of the Amazon, is a remote, and in many cases, spectacularly beautiful region. Colonial explorers traveled up the Orinoco river searching for the mythical city of gold, El Dorado. Unlike the gold rush days of the American old west, where huge gold strikes would cause everyone from everywhere to descend on areas where it seemed gold was just “lying around for the taking” (which we all know was never true), the gold in this region, while plentiful, is dispersed over a large area.
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