Venezuela's oil minister, Rafael Ramirez, says ConocoPhillips and ExxonMobil will end their operations in the country after refusing to give the government control of their local oil business.
A deadline for a deal passed on Tuesday. Venezuela's state-run oil company, Petroleos de Venezuela or PDVSA, has raised its average ownership share in six oil ventures in the Orinoco basin from 39 percent to a controlling 78 percent.
The U.S. State Department says Venezuela has the right to nationalize its assets, but should provide fair compensation. Venezuela has said it will not pay cash for the oil assets it takes over and will not compensate foreign companies for the $4 billion in debt they incurred on the projects.
Four other foreign oil companies: Chevron, Statoil, Total, and BP, have signed deals to continue work in Venezuela.
Some information for this report was provided by AFP, AP and Reuters.