Seeking rate cut: Venezuelan Minister of Energy Rafael Ramirez
PDVSA asks contractors to slash rates
PDVSA boss Rafael Ramirez has revealed that the state-run giant in is talks with contractors which could see services players working for the Venezuelan company drop their rates by as much as 40%.
"In most cases, we have five-year term agreements. We are reviewing the contracts because the current rates are unbearable," Ramirez, who is also Venezuela's oil minister, said.
A report published in the El Universal newspaper quoted him as saying that, according to PDVSA estimates, the costs related to contractors must be lowered 40% by implementing new rates that are consistent with the collapse of oil prices that has seriously hit the energy market.
"Given the present market conditions, which have changed dramatically, we need to revise the rates downward or we will not be able to contract some companies," Ramirez added.
He admitted that negotiations with the contractors "have been hard".