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Conoco feels the Chávez effect

Hugo Chávez's moves to take control of foreign oil investments in Venezuela caused a 94 per cent drop in ConocoPhillips' earnings in the second quarter, as the company warned that future production would be hit because of the loss of assets in the country.
Conoco, the third largest US oil producer, said its net income had been hit by a $4.51bn charge after it decided to walk away from its projects in the oil-rich Orinoco belt, rather than accept the terms being forced on it by Mr Chávez.
The Venezuelan president announced a month ago that the national oil company PDVSA was taking control of the reserves, worth at least $25bn, in the Orinoco region, in eastern Venezuela.
ExxonMobil, the world's biggest oil company, also failed to agree to terms with Venezuela. BP, Statoil, Chevron and Total had previously accepted the new terms.
Conoco was particularly badly hit by the move, as its operations in Orinoco were valued at about $6bn and account for about 10 per cent of its reserves.
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