WSJ’s Anatoly Kurmanaev Wrote a Moving Farewell Piece about the Oil and the People in Lake Maracaibo

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Anatoly Kurmanaev’s farewell piece as WSJ’s Caracas correspondent tracks PDVSA’s transformation from a well-run state-owned oil company that would provide good jobs and prosperity for Venezuelans in the Maracaibo Lake area, to a train wreck of a company. PDVSA was destroyed by rampant corruption and mismanagement; it can’t even pump oil or pay its workers, who now live in a run-down city, where misery is rapidly spreading. It’s a microcosm for chavismo.

He first reminds us that, contrary to chavista propaganda, Venezuela was once a vibrant country with class mobility, where a blue-collar oil worker could have a comfortable life:

“Oil from brackish Lake Maracaibo transformed this country a century ago from a tropical backwater into the world’s biggest oil exporter and, for a time, South America’s richest country.

Here at the lake today, thousands of idle derricks stretch to the horizon, crippled by lack of spare parts and routine maintenance. At its dozen oil ports, hundreds of barges, rigs and speedboats sit rusting in the scorching sun.

Workers here once enjoyed the country’s highest wages, company perks and elite schools; in December, the local oil union evacuated an entire rig after finding its oilmen malnourished…

For decades, the lake area was the jewel in PDVSA’s crown. Workers lived in leafy company compounds with bowling alleys and cinemas. They shopped in company supermarkets and vacationed at its private beach resorts.”

Then he tracks the obscene, decadent corruption that took us from having a world-class oil company with renowned partners, to patent corruption schemes involving maletín-companies that helped chavista honchos get rich by looting the country while destroying PDVSA and the life of its workers.

“Most international service companies, such as Schlumberger Ltd. and Weatherford International Ltd., have cut operations to a minimum after years of unpaid bills, according to workers. The companies declined to comment.

Dozens of local service companies were expropriated by PdVSA in 2009, their ships and barges abandoned or cannibalized for spare parts.

They have been replaced by military-controlled contractors and local firms like S&B Terra Marine Services, which took over the operations of Schlumberger’s six rigs in the lake last year. Only four of those rigs still work, according to oilmen who have worked at both companies.

Of PDVSA’s 560 speed boats in the lake, only six are operational, according to oil union activist Hector Berti.

S&B Terra Marine Services operated the PdVSA rig that was evacuated in December; some of the two dozen workers were taken to a hospital with dehydration and high blood pressure.

The company’s owner, Basil Al-Abdala, made local headlines in 2016 when he threw a lavish Aladdin-themed party for 1,500 people, featuring Colombian reggaeton star Maluma, to celebrate his daughter’s 15th birthday.”

The saddest part of the piece is its chronicle on the decline of life conditions in PDVSA Maracaibo, from upward mobile and well-paid workers to malnourished men sitting idly in abandoned fields:

“Nowadays, that seems like a distant dream.

“It’s as if we were animals, some wild beasts,” said one rig worker, Jesús, who asked that his family name be withheld for fear of government reprisal.

PdVSA didn’t respond to requests for comment about company operations and worker conditions.

On a recent Wednesday afternoon in the lakeside oil town of Ciudad Ojeda, PdVSA workers sat in empty air-conditioned offices adorned with Socialist Party posters.

Roberto, a foreman, said his oil barge had been waiting for three months to sail. Each day something was missing: food, motor oil, a tugboat. His team of a dozen people comes back each day and waits—until it is time to go home.

After two decades in PdVSA, Roberto earns an equivalent of $8 a month. This Christmas, for the first time, he had no presents to give his seven children.

‘I see the look in their eyes when they stare at the empty Christmas tree, I feel such a pain here,’ he said, pounding his chest.”

This is an excellent piece, a reminder of Kurmanaev’s keen knowledge of our country and his ability to find the most meaningful stories and scoops.

Thank you and godspeed, Anatoly.

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  1. You are quite right in citing this excellent piece. I read it in today’s WSJ before reading your commentary . Virtually everyone agrees about the role of corruption in Venezuela’s downfall but I hope serious scholars study the outcomes of Venezuela’s ecperiment with quasi communism. Are the poor any better off as a result of redistributionist policies. While Mr Kurmanaev’s account is anecdotal, it sure suggests that redistribution actually had an adverse impact on workers. It is objectively a stunning outcome that quasi communism has destroyed the economy of a nation rich in oil reserves and the topic deserves scholary and unbiased examination.

    • You had crackpot, quasi-communist schemes combined with massive institutionalized corruption and truly crony capitalism, as well as using the oil giant as a piggy bank while doing nothing to maintain it and putting political hacks in charge of industries.

      It took a special combination of idiocy and criminality to get to today.

      • Not just massive corruption, some estimates of US$350 billion. Half of that would pay off all/most external debts. The amount of corruption/ineptitude are mind numbing. It takes a special type of “special” to pull off that feat. (Special being the amount one believes themselves to deserve based on their connection to the regime or the sheer audacity it takes to steal so much.)

  2. Socialism strikes again.

    We see this time and again. It is not that social programs are inherently bad. But they are so poorly executed or they are so often architected to somehow punish the private sector.

    Communists always excuse their mistakes as an act of sabotage from the right.

    But, I really don’t feel that bad for a country that votes these people into office.

    Both sides are pushing Communism. One just wants more naked corruption and the other just wants to taste those spoils for once.

    Trump needs to keep US troops out of that shithole. Yes, I said it even if he says he didn’t.

  3. “Of PDVSA’s 560 speed boats in the lake, only six are operational”

    This is where one has to be optimistic. There’s much room for improvement for this Kleptozuelan tropical narco-regime. They have to find new ways to steal, not just heavy oil that is already mortgaged, or the KleptoPetro and other financial Mega-Guisos, or the Gigantic Food scams, and here’s a golden opportunity.

    Yes, it takes a little work, planning, discipline, which Chavistoide Thugs hate. They’re used to huge stolen profits while doing nothing, Derwick style. A little technical savoir faire, which few of the remaining “ingenieros” or “obreros” possess. And yet bounty could be a solid, ongoing stream of succulent guisos.


    True, a rare, innovative concept by now in Kleptozuela, but potentially highly profitable for many layers of PDVSA’s and Corpolec’s employees. Spare parts, materials, “suministros” of all kinds needed at all times for years, recurring orders of the same guiso-products. The profits could be astronomical, steady, easy after the first murky deals are in place.. A potential big mordida at each stage, for each product from multiple suppliers, from the inflated purchasing price on bogus contracts, to the financial ajuste into “bolivares fuertes”, cadivi, etc, to the usual customs big cuts, to phantom “horas extras” for each repair.

    Then they can steal more parts, resell them. and prepare another juicy purchase orders, and all the zamuros on the Klepto-tropical “Supply Chain”, from the big Hyenas to the smaller crows (blue-collar obreror), every one participating in the Desfalco Nacional gets a juicy bite. Thus, with little effort, PDVSA, Corpoelec and all other Chavistoide enterprises could even produce a bit more, generating even more twisted loans from India or China, and lighting up Maracaibo to cook other guisos in every industry still standing.

    Kleptozuelan Maintenance! Otro negocio redondo para la rebulusion bolibanana! “No mi pana, jefesito, a esa maquiria hay que dale mantenimiento, ta’ desgastaa, faltan piesas, ya tu sabe, compañero..”

  4. Ideological types have the idea that all it takes to make things work is to put on top people who are inpired by the loftiest of ideological principles , that ideology in and of itself is enough to produce the best results , those that most benefit the general population , that expertise and knowhow and well tested organizational practices and systems are redundant or of little importance in how things actually turn out ……that all it takes to make things perfect is to do away with the meanies (your ideological enemies) from the top jobs ……, that good ordinary folks joined by a common ideological fervour can achieve miracles !! We ve heard this so many times !! Thats were the naive and delusional belief in the capacity of ‘popular’ communes to succesfully take over all the functions of a modern economy come from .

    Of course it doenst work that way , the result is the disaster that now afflicts that formerly top knotch international grade organization that was Pdvsa some 20 years ago , it took a lot of mismanagement corruption and neglect but they finally killed the chicken that laid the golden eggs !!

    Marx never worried about these subjects , he was very proud of not being utopian but scientific , but he did write that when the forces of the proletariat were freed from their capitalist shackles that would liberate their productive energies so that there would be an overabundance of all things so that people would only have to work for part of a day and dedicate the rest to other more leisurely activities ……..

    Making things work is very difficult and requires a lot of time developing the organizations and expert teams that know how to make things work …….lets hope if we ever get a second chance at rebuilding our economy and its main institutions we remember this ……!!

    • “Making things work is very difficult and requires a lot of time developing the organizations and expert teams that know how to make things work …….lets hope if we ever get a second chance at rebuilding our economy and its main institutions we remember this ……!!”

      I believe that’s called planning. And in my personal experience, planning is a concept few Venezuelans seem to embrace.

      As long as I’m okay today, everything’s fine with the world.

  5. Though it appears Nicolas is planning for the future.

    Word is he’s ordered that Bolivar notes in the amounts of 10 and 20 be recirculated to relieve the cash shortage on the streets.

    Shit for brains.

  6. “Bolivar notes in the amounts of 10 and 20” … Aren’t those the same notes the that looters did not bother with?

  7. The collapse of PDVSA didn’t occur overnight. The collapse began from the minute El Finado had sufficient control of PDVSA to fire the strikers. In 2007 CC had an article on a blowout that occurred at a well being drilled near Anaco. “I’ll take the gunbao chicken, some springrolls, and 32,000 b/d, please…” (Unfortunately, the comments got erased in a software update.)

    I e-mailed a petroleum engineer consultant with a picture of the rig, to get his take on it. It turned out that he had made numerous inspection trips to Venezuela over the years. He wrote me that he had seen marked deterioration in maintenance of PDVSA equipment over the past several years. And this was in 2007.

    • Interesting Boludo. Back in 2008 I recall driving by a wellsite near El Tejero in Monagas that had a snubbing unit working on-site. The whole operation was within 150 yards of the main highway. I told the young fellow with me that snubbing was very dangerous work, even when done with good equipment and properly-trained crews.

      About a week later that sucker blew out and left the main highway between Barcelona and Maturin closed for a number of weeks. I don’t recall if there were any injuries or deaths but the commerical damage was extensive.

      I can’t imagine the dangers of working today’s Venezeulan oilfields with the way things have deteroriated.

      • Like you…and you and you and you who visit and post on CC…we suck up every news article we see on Venezuela, and anything related to the oil industry in general. Most of us have been doing this for two decades!

        (Damn, do I feel old.)

        But we’re still learning every day, and today, I read an article which in a simple sentence, explained PDVSA’s problem, and explained the oil industry in general. Something I never understood, because I’m not an oil man.

        When we hear reports/complaints of lack of investment in VZ’s oil projects, we tend to think of this as investment in the future, to expand current production. This has always been MY understanding of the issue. But no.

        This article, in that one sentence, explained to me how the industry is extremely capital intensive just to MAINTAIN production levels. In other words…

        When they say “investment,” they really just mean fucking “MAINTENANCE.”

        Which of course, Chavismo fails at with flying colors.

  8. As MRubio says one of our national failiings is a lack of foresight and planning . remember a study done many years ago to answer the question why our metalmechanical industries were so far behind US or Japanese industries of the same kind , the researchers looked at all factors , machinery:modern and up to date , labour : dedicated and trustworthy , all factors checked except for one , absolute lack of planning (including the planning of maintenance) , machinery was used continously until they were run aground , some of the handiwork and craftsmenship was excellent , the guys at the installations got a new japanese vessel and compared it to one of the local vessels also recently arrived (from one of the best companies long ago gone broke) and they were totally comparable ……also remember a musiu manager telling us how he tried replacing expatriate specialists for local ones ( trying to save on money : expatriates are expensive) and how he failed , the locals were brilliant at figuring out how to repair a broken piece of machinery , better than the expatriates but they were hopeless at complying with the maintenance protocoles that the machinery required causing them to break down all the time ….

    • “the locals were brilliant at figuring out how to repair a broken piece of machinery , better than the expatriates but they were hopeless at complying with the maintenance protocoles that the machinery required causing them to break down all the time ….”

      As usual Bill, you’re spot-on with your observations.

      I see the same thing play out here year after year but the locals just simply refuse to plan for it, or act on it.

      Our corn harvest usually starts in November and runs through Jan. Whatever its cost per kilo before the harvest, once the harvest commences, the price immediately drops by 50% or more. Corn in October cost 5,000 bs per kilo. When the harvest started, I heard of prices quoted as low as 1,800 bs per kilo but nothing was offered to me at that price. My first purchase was at 2,500 bs per kilo in late November. And I bought the bulk of what I have stored at that price. Today, 20 January, prices are at 15,000 bs per kilo and climbing rapidly.

      Now, everyone here in town eats arepas. Arepas have got to be the national food of Venezuela. Everyone here in town knows that as soon as the corn harvest is terminated, that prices will quickly double or triple, or more. Everyone in town knows that if they’re prepared, that at the right moment they could buy a year’s worth of corn, or a few month’s worth of corn, for their families at a fraction of the cost and store it for months on end without damage in clean, steel drums. Just a few steel drums! But they won’t do it. And it’s not because they don’t have the money because they do. They won’t buy the drums and they won’t buy the corn to store in the drums. I don’t know why.

      Instead, they’ll complain about the scarcity or price later as they stand in line in the broiling sun waiting for the Polar truck to bring subsidized corn flour that still costs double or triple what they could have stored and processed for themselves.

    • Though at times the issue is that there were good plans, but they were not followed. Consider the 2010 drought problem with the Guri hydroelectric system. Engineers had planned for new dams to increase hydroelectric capacity, but El Finado did not approve them. Or he approved them many years after they were proposed.

      Then the drought, and water level at Guri kept falling. Oh, we suddenly have a drought.It isn’t as if there had never been droughts – they occurred like clockwork (every 5-6 years, IIRC) . Oh, we suddenly have an increase in electrical demand. It isn’t as if electrical demand never increased. 🙂

  9. “He first reminds us that, contrary to Chavista propaganda, Venezuela was once a vibrant country with class mobility, where a blue-collar oil worker could have a comfortable life.”
    That is almost an understatement and needs to be explained better. Half of my family were economically poor, yet thanks to the Government free public Universities they became professionals and reached upper middle class within their lifetime. A generation later I found myself studying at USB (another free public university)among people of all kinds of economic backgrounds no just rich kids. They in turn became professionals and economically prosperous only to be forced out of the country by the Chavismo debacle. Now that I’ve been living in the USA for more than 20 years I can confidently compare and say that Venezuela was the land of opportunity back then, even more so than the US actually is !!
    Ironically while Venezuela was educating their people in and abroad with generous scholarships, there was never a constitutional requirements for experience or professional standards in the political class. You could go from street beggar to President of the Republic if you had the votes no problem!! This is how we ended up in this disastrous predicament of Chavez as President despite never holding any public political position in his life nor any relevant education for that critical job, and the same reason why Maduro (a bus driver) is the Dictator while Economists, Engineers and Political Scientists are driving taxis in Colombia for a living!!

    • VZ economists and political scientists are driving taxis in Colombia because, why shouldn’t they?

      Every country has their over-educated working in lower level jobs. So to point out the VZ experience in this regard as uniquely sad is just nonsense.

      And to claim that VZ was a greater land of opportunity than the U.S. is just downright…what adjective shall I use?

      Fucking ridiculous.

      • Ira is a textbook case of a Trump supporter: vulgar, spiteful, and spouting arguments that make no logical sense.

        The American Dream, it is exactly that a dream not a reality. People in so called socialist Europe have a higher chance of upward mobility than in the US:

        ‘In Denmark, a poor child has twice as much chance of making it to the top quintile as in America.’

        Mr Toro’s story is NOT an anomaly, there are thousands of cases like him. Also not to mention for example my grandparents who were dirt poor immigrants and came to Venezuela worked hard and did very well for themselves. Venezuela was once a land of great opportunity.

        • Reread your reference, Kike, that is not what it says. It states that the US is lower than in MANY European countries, then cherry picks tiny Denmark (pop. 6M) and compares it to the US as a whole (pop. 330m).

          I could cherry pick, say, Massachusetts, or Houston, and compare it to all of Europe, and declare just the opposite.

          • I am reminded of Milton Friedman’s remark about Scandinavians in the United States.
            If Sweden’s Big Welfare State Is Superior to America’s Medium Welfare State, then Why Do Swedes in America Earn Far More than Swedes in Sweden?

            The 4.4 million or so Americans with Swedish origins are considerably richer than average Americans, as are other immigrant groups from Scandinavia. If Americans with Swedish ancestry were to form their own country, their per capita GDP would be $56,900, more than $10,000 above the income of the average American. This is also far above Swedish GDP per capita, at $36,600. Swedes living in the USA are thus approximately 53 per cent more wealthy than Swedes (excluding immigrants) in their native country (OECD, 2009; US Census database). It should be noted that those Swedes who migrated to the USA, predominately in the nineteenth century, were anything but the elite. Rather, it was often those escaping poverty and famine. …A Scandinavian economist once said to Milton Friedman, ‘In Scandinavia, we have no poverty’. Milton Friedman replied, ‘That’s interesting, because in America, among Scandinavians, we have no poverty, either’. Indeed, the poverty rate for Americans with Swedish ancestry is only 6.7 per cent: half the US average (US Census).
            (quote from an IEA study, which currently is a bad link.)

            I am reminded of Bernie fans and Socialism and Scandinavia, and what the Danish Prime Minister said about Socialism. Not to mention what Bernie said about banana republics.

          • Lorenzo your argument is valid, but in essence what you are saying is that so called socialist Europe has the same opportunity for advancement than capitalist Latin America for the average person.

            I realize that the US has much better opportunities if you are very talented or are an entrepeneur.

  10. Kurmanaev was a wonderful reporter in Venezuela. His Soviet roots meant that he could see past the bullshit and find and expose the criminals, morons, and koolaid drinkers. And he could put his finger on the abscesses of social oil you putrefying quietly everywhere in the country.

    I hope they’ll send someone just as good, but I don’t think it’s possible.


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