Venezuelan Gov not to expropriate gas stations

The Organic Law on Rearrangement of the Domestic Market of Liquid Fuels, to be passed in a first session next Wednesday, does not provide for seizure of the gas stations operating in the country, reported Deputy Ángel Rodríguez, the chairman of the Commission of Energy and Mines, National Assembly (AN). The congressman explained that the legal instrument reserves for the state the role of middlemen for supply of liquid fuels, particularly transportation, reported state-run news agency ABN."The bill does not state compulsory transfer of these outlets to community councils. The Bolivarian government expects these partnerships to play a significant role in this activity. It will be a gradual change, and one of the alternatives under study is the assignment of the management of new gas stations or any current stations property of the state," said Rodríguez.

The wide range of brands that prevailed during liberalization of the Venezuelan domestic fuel market in the mid-90's is coming to an end, as gas stations in the country  from now are to be branded only by PDV -whose logo now displays the Venezuelan national flag .  The Draft Organic Law on the Restructuring of the Liquid Fuels Domestic Market is to be debated Wednesday by the National Assembly. The bill reserves to the state the role of middleman between state-owned oil company Pdvsa and liquid fuels retailers. Therefore, following passage of the bill, private domestic and foreign wholesalers will no longer play the role of middlemen. Gas stations in Venezuela are currently branded by such companies.

"Either Pdvsa or the subsidiary it may designate shall brand any and all of the gas stations where supply of liquid fuels is subject to intermediation. They shall also brand the transport units subject to this regulation," reads Article 4 of the bill.Out of the 920 gas stations branded by private firms in Venezuela -which amount to 51 percent of the domestic market- most are owned by Venezuelans, especially Trébol and Llanopetrol. These two companies hold a 26 percent share, following Shell decision to withdraw from the Venezuelan market back in 2004. They are followed by BP (7 percent); CCM (6 percent); Mobil (5 percent), whose national assets are about to be sold; Texaco (3 percent) and Petrocanarias and Petrolia (2 percent each). Overall these companies only provide their brands and the pumps at each gas station. Besides, they act as middlemen as they buy gasoline, diesel and lubricants from Pdvsa and sell them -with a small profit margin- to the businessmen who own and manage the gas stations.