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JAMAICA moves to expriopriate Venezuelan shares in Petrojam

Featured Foreign Affairs and Foreign Trade Minister Senator Kamina Johnson Smith Foreign Affairs and Foreign Trade Minister Senator Kamina Johnson Smith
KINGSTON, Jamaica, January 8, 2019 - The Government of Jamaica has moved to expropriate Venezuela's 49 per cent share holding in the local oil refinery, PetroJam held by that country's oil and natural gas company PDV Caribe.

Foreign Affairs and Foreign Trade Minister Senator Kamina Johnson Smith this morning told a press conference that the Government will take legislative action to take ownership of the 49 per cent Venezuelan share holding, indicating that the move forms part of the Government's thrust to develop and protect Jamaica's energy security.

She outlined that PDV Caribe — an affiliate of the state-owned Petróleos de Venezuela SA (PDVSA) — and the Petroleum Corporation of Jamaica (PCJ) entered into a Joint Venture Agreement and an agreement to sell shares in Petrojam in August 2006 and February 2007, respectively.

The reasons for entering into the agreements included the upgrading and expansion of Petrojam's Refinery so as to improve its competitiveness and meet local and international market demands.

However, as at this time, these objectives have not been met and the refinery is now a risk to the economy and the country as result of the upgrade not being undertaken, the minister disclosed.

The Foreign Minister said that Venezuela's President Nicholas Maduro made a committment during a meeting with the Jamaican Government in 2016, that action would be taken on the upgrade. However, after signing a Letter of Intent in January 2017, and the Refinery Upgrade Agreement in February 2018, Venezuela is yet to fulfill their obligations.

 “Even as the Government of Jamaica acknowledges, values and appreciates the tremendous support provided to this country by the Bolivarian Republic of Venezuela to the energy sector over the years, Jamaica regretfully cannot continue negotiations in perpetuity, especially where it appears that delays are of no concern to our counterparty. Therefore, in the national and economic interest of Jamaica, the decision has been taken to commence the legislative process towards acquiring the shares in Petrojam held by PDV Caribe,” said Johnson Smith.

  • Countries: Jamaica
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