Venezuela’s oil minister warned yesterday that foreign oil firms might not be compensated when their operations in the OPEC affiliated nation’s vast Orinoco reserve oilfields are taken over by the government in coming months. This has followed Friday’s rhetoric by Venezuela’s president, Hugo Chavez, in which he had challenged oil companies to sue him. Rafael Ramirez – oil minister – told reporters on the sidelines of an energy summit on the Venezuelan resort island of Margarita: We are all talking. There are permanent conversations with all the partners. We are going to see if there’s compensation because in some cases there may not be compensation. Chevron Corp. (U.S.A.), Exxon Mobil (U.S.A.), Conoco Phillips (U.S.A.), Statoil (Norway), BP Plc (U.K.) and Total (France) stand to lose millions of dollars because of proposed nationalization of their investments in the reserve of tarry crude. Ramirez, however, said that most of the companies were willing to stay on after the government takes a majority stake in the four heavy crude upgrader projects that are valued at more than $30 billion and can produce 600,000 barrels per day. The companies are willing to overlook the uncalled for treatment meted out to them because Orinoco is one of the world’s largest reserves and high oil prices allow them to return profits. May 1, is the official date when Venezuela’s state oil company, PDVSA, takes over the operation of the projects. Government seeks to finalize the detailed joint venture’s makeup by June 26. Eulogio del Pino, state oil company’s official in charge, said that the documents formalizing the transfer of operations will be signed within days. He, however, added that the government was still mulling different options for compensating the companies, ranging from cash to payment in oil to exchanging assets. Conoco Phillips’ CEO, James Mulva, denied that the company had been threatened regarding compensation. He said that the discussions finalizing proposed takeover were ‘on’ and may well stretch beyond 1st of May. He said: The negotiations regarding the compensation and commercial terms going forward is going to go, certainly, beyond the first of May. It will take possibly weeks or months to conclude that. Hugo Chavez’s self-styled socialist revolution will get a shot in the arm if indeed he follows up on his ‘challenge,’ and successfully nationalizes the operations of foreign companies without further controversies.