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Venezuela's Congress Recommends State Majority in Key Oil Projects


The Venezuelan Congress has recommended that the state assume majority control over four key oil projects in the oil-rich Orinoco River basin.

The recommendation was made Thursday, days after President Hugo Chavez said he plans to raise taxes on foreign oil companies in Venezuela. He described the move as an extraction tax, saying it would create $1 billion in new state revenue. The new tax will be 33 percent, up from 16.7 percent.

The Chavez government has been taking measures to strengthen state control of the energy sector in the world's fifth-largest oil exporter. He has accused foreign oil companies of exploiting his country's vast petroleum reserves without paying sufficient taxes.

Thirty two oil fields previously operated under contract by private companies are now run by "mixed companies" in which the state holds majority shares.

Some information for this report was provided by AP and Reuters.