Chad minister defends oil ultimatum

A Chad minister has confirmed that his country's decision to expel US giant Chevron and Malaysia's Petronas was for failing to pay their tax and was not aimed to nationalising Chad's oil industry.

    Chad produces about 160,000 barrels of oil a day

    Speaking from Kuala Lumpur, Mahamat Bechir Okormi said that the solution was for the companies to pay their outstanding tax, and reiterated that the government was not interested in gaining control of the country's oil production.


    "The problem was that Petronas and Chevron had to pay tax, then they arranged with a certain individual, a minister, in order to get a tax exemption," he said.


    "In Chad, only the national assembly can exempt companies, not a minister."


    Okormi was in Malaysia attending a meeting of Islamic nations discussing corruption.


    A history of corruption


    Petronas had said at the weekend it had not received any official notification of the move and was seeking information from the government.


    Chad's surprise move followed its decision to create a national oil company which it said should become a partner in the country's existing oil-producing consortium, led by Exxon Mobil and including Chevron and Petronas.


    Petronas holds 35% of the consortium, Chevron 25%, and Exxon the remaining 40%.


    Chad's government has been known to use oil as a bargaining tool to threaten companies and organisations before.


    In April it said it would stop oil production unless the World Bank unlocked an oil revenue account frozen in a dispute over how it spent its oil profits.


    A Transparency International survey ranked Chad last year as the world's most corrupt state. Chad began pumping crude oil in 2003 and produces about 16,000 to 17,000 barrels per day.

    SOURCE: Reuters


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