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UPDATE 1-Venezuela's PDVSA triples contributions to state
December 7, 2011 / 5:21 PM / 6 years ago

UPDATE 1-Venezuela's PDVSA triples contributions to state

* Oil company is financial motor of Chavez policies

* First half results show more profit and debt

* Net income up 50 pct, debt up 42 pct

(adds confirmation, details)

By Marianna Parraga

CARACAS, Dec 7 (Reuters) - State oil company PDVSA more than tripled contributions to President Hugo Chavez’s social programs and development fund in the first half of 2011 compared to the same period last year, company results show.

PDVSA’s first-half figures, seen by Reuters on Wednesday, showed a massive, ten-fold hike in contribution to Chavez’s off-budget special development fund Fonden to $7.3 billion, compared with $691 million during the same period of 2010.

Transfers to existing “missions” -- the social projects in slums and other poor areas that have assured Chavez’s popularity among the poor in a 13-year rule -- nearly doubled to $8.5 billion from $4.5 billion.

A new “Great Housing Mission”, under which Chavez hopes to solve Venezuela’s two million housing unit deficit in coming years, took another $2.4 billion, the results showed.

The total increase in contributions to the state over the period -- from $5.2 billion to $18.2 billion -- was in keeping with an accelerating spending spree by the government ahead of a 2012 presidential vote.

Despite recent cancer treatment, the socialist Chavez is seeking reelection and counting on massive support from the poor majority among Venezuela’s 29 million people.

The OPEC member’s state oil company has long been the South American nation’s financial motor, but critics say the Chavez government is bleeding it dry and failing to give accountability for billions of dollars in oil revenues.

Fonden is a discretionary fund the government says is used for development projects, but which critics say has spawned corruption and secrecy.

Net income rose 50 percent in the first half to $4 billion, due to the healthy price of crude and less tax.

Revenues rose 37 percent to $64.1 billion.

But PDVSA’s total debt also soared to $31.2 billion at the end of the first half of 2011, compared with $21.9 billion at the same time last year, according to the PDVSA figures.

Of that, a whopping $9.3 billion is owed to suppliers.

Analysts say PDVSA’s debt profile is worrying given upcoming maturing bonds and the need for multibillion of investments in the extra heavy crude Orinoco Belt to boost national production in coming years.

The first half figures also showed that operating costs rose to $60.8 billion, compared with $38.9 billion between January and June of last year.

Crude output in the first half was up a fraction to 2.986 million barrels per day, with the average production cost at $6.33 per barrel compared to $4.04 for the same period 2010. (Writing by Andrew Cawthorne; editing by Bob Burgdorfer)

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