ConocoPhillips Profit Plunges on Exit From Venezuela

(Bloomberg) — ConocoPhillips, the third-largest U.S. oil producer, said second-quarter profit tumbled 94 percent after Hugo Chavez’s government seized the company’s assets in Venezuela.

Earnings dropped to $301 million, or 18 cents a share, from a record $5.19 billion, or $3.09, a year earlier, Houston-based ConocoPhillips said today in a statement. Writing off the Venezuelan properties reduced net income by $4.51 billion.


Venezuela took over ConocoPhillips’ two heavy-oil ventures in the South American nation and another project offshore when the company refused to sign an agreement ceding ownership of the assets. The country accounted for about 10 percent of the company’s reserves and more than 4 percent of output.

“We have not abandoned any hope that we can reach an amicable solution,” Chief Executive Officer Jim Mulva told reporters last week in Washington. “It’s only if we cannot do that, that as a last resort, we’d consider arbitration.”

Bloomberg