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Friday, 09 January, 2009, 01:10 GMT | more >>

Williams hit by Venezuela tax bill



By Upstream staff 

Venezuela's tax authority Seniat has handed US-based company Williams Cos. with a $744,000 back-tax claim.

Seniat said the bill followed an audit of the company's income tax payments for operations during 2003 and 2004.

Williams subsidiary Williams International Oil & Gas is partnered with Brazil's Petrobras to pump crude at the La Concepcion field under a subcontracting venture known as an "operating service agreement", a Reuters report said.

In 2005, President Hugo Chavez declared the deals illegal and ordered companies to convert operations to joint ventures with a majority held by state oil company PDVSA.

Tax authorities also ruled the companies should have paid 50% income tax rather than the 34% specified in the contracts, leading to dozens of back-tax bills for the 22 companies operating the 32 subcontracting deals.

Williams was also a partner with Canada's Enbridge in an oil terminal that Venezuela nationalized in 2003 during a massive walkout at PDVSA, which accused Enbridge of sabotaging operations.

Following an arbitration decision, PDVSA agreed to pay $25 million to the consortium in compensation.

Venezuela has delivered back tax bills of close to $1 billion to companies operating oil fields in an effort to boost government revenue.


Tuesday, 06 February, 2007, 20:04 GMT  | last updated: Tuesday, 06 February, 2007, 20:04 GMT

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