Venezuela's President Hugo Ch?vez waves after being sworn in for a third term in Caracas on January 10. - Reuters

United States oil giants ConocoPhillips and Chevron Corp have agreed to cede by May 1 operations of multibillion-dollar projects in the Orinoco heavy- crude belt, Caracas has announced.

In compliance with a decree issued last month by Venezuelan President Hugo Ch?vez, the companies will form transition committees to oversee the handover of their projects' operations to state oil company PDVSA.

Exxon Mobil Corp has already agreed to pass control of its operations to PDVSA by the tight May Day deadline.

Pressing plans

Chavez, who is pressing a raft of oil nationalisation plans since a December landslide re-election, wants the state to take at least 60 per cent of the projects that develop tarry crude in the OPEC nation.

Although he set the May deadline for PDVSA to take the operational helm, he is allowing the foreign investors until almost September to finalise the terms of their stakeholding in the projects.

PDVSA director Eulogio del Pino said in a company statement the committees were being formed "so that the nationalisation of these businesses should be finalised by May 1 and that the operations should be transferred from the foreign firms to the Venezuelan state."

The four Orinoco projects, valued at more than US$30 billion, turn tar-like oil into around 600,000 barrels per day of lighter synthetic crude.

For years, Ch?vez, who declares himself an enemy of capitalism, has squeezed foreign oil investments with nationalisation moves and taken over some assets in other industries.

But the major oil companies' Orinoco investments are the largest he has taken on since coming to power in 1999. The pace of the takeovers and the absence of open opposition from the companies have surprised political and economic analysts.

There has been no word on whether the Sincor heavy-crude project, involving France's Total and Norway's Statoil ASA, will transfer to PDVSA control in the Orinoco.

But Total's chief executive said this week his company regards the Orinoco as a priority and promised to work 'shoulder to shoulder' with Venezuela over its investments in the country.

Del Pino also said Conoco agreed to set up a transition body for the May 1 handover of operations in a natural gas field, Corocoro, which is covered by last month's decree too.

- Reuters