Ecuador President: Nationalized Oil Firms Would Be Compensated

[FreakinDJ]

Ecuador President: Nationalized Oil Firms Would Be Compensated

DOW JONES NEWSWIRES

Ecuadorian President Rafael Correa reiterated Tuesday his threats to foreign oil companies operating in the country and added that under a potential nationalization of the oil industry
the seized firms would receive compensation.

Correa said during an interview with regional news channel Telesur that a new law being crafted by the national assembly would be very brief and permit the expropriation of the oil industry. "Expropriation is not the same as confiscation," Correa said during the interview. "Here they are going to receive economic compensation."

The government announced over the weekend that it will seize oil fields controlled by companies that don't agree to exchange their production contracts with service contracts with the government.

Through those services contracts, Correa's left-leaning, cash-strapped government is seeking to gain more control over and access to oil revenue. Oil companies will be paid a production fee and be reimbursed for investment costs, while the government will own 100% of oil and gas produced by private companies.

http://www.foxbusiness.com/story/markets/industries/energy/ecuador-president-nationalized-oil-firms-compensated/

[Arctic Dave]

1. Good, the State should always own the resources,

then give out contracts for extraction.