VENEZUELAN HYDROCARBONS:VENEZUELAN HYDROCARBONS:AN OPPORTUNITY FOR PRIVATE INVESTMENTAN OPPORTUNITY FOR PRIVATE INVESTMENT

The abundance of natural resources gives a definitive advantage.

A large internal and nearby market for G&S, with ample advantages for business in nearby countries.

A realistic, focused on development, and substantial development plan in Venezuela for the coming years.

Plans to use and develop a strong local G&S sector.

A modern legal framework in place.

A large diversity of clients.

The abundance of natural resources gives a definitive advantage.

A large internal and nearby market for G&S, with ample advantages for business in nearby countries.

A realistic, focused on development, and substantial development plan in Venezuela for the coming years.

Plans to use and develop a strong local G&S sector.

A modern legal framework in place.

A large diversity of clients.

A large number of established local business and businessmen with knowledge of the local conditions,

willing to take risks, to invest and to form Joint Ventures.

The facts:

THE CONCEPTTHE CONCEPT

Textbook Conditions for Development

Large Internal Market, large external opportunities

Demanding Market to international standards

Highly competitive Supply & Demand

Large Expansion plan O&G

Location

Program & Policies in place

THE OBJECTIVE:THE OBJECTIVE: DEVELOP G&S CLUSTERS FOR THE DEVELOP G&S CLUSTERS FOR THE LOCAL MARKET AND FOR EXPORTLOCAL MARKET AND FOR EXPORT

STRATEGY OF THE LOCAL PRIVATE SECTORSTRATEGY OF THE LOCAL PRIVATE SECTOR

Develop current properties to

their full potential.

Identify new opportunities.

Develop associations with local

and international players.

Increase capitalization

(strategic partnerships, capital

markets).

Export.

Develop current properties to

their full potential.

Identify new opportunities.

Develop associations with local

and international players.

Increase capitalization

(strategic partnerships, capital

markets).

Export.

THE CONCEPT: TO ADD STENGTHSTHE CONCEPT: TO ADD STENGTHS

JV & Alliances of Local and Foreign companies.

The establishment in Venezuela of new joint companies.

Technology transfer agreements.

Cooperation agreements.

Promoting:

Strategic joint ventures, with foreign companies,

are highly encouraged as policy to establish

synergic relationships, integrating the skills,

experiences and strengths of each partner under a

gain-gain approach to develop the Venezuelan and

the export markets.

Strategic joint ventures, with foreign companies,

are highly encouraged as policy to establish

synergic relationships, integrating the skills,

experiences and strengths of each partner under a

gain-gain approach to develop the Venezuelan and

the export markets.

JV’s in Venezuela make business sence

BENEFITS TO THE PARTNERSBENEFITS TO THE PARTNERS

Joint BenefitsForeign Partner

Local Partner

Privileged, access to strong Venezuelan and near by market to their product services and technology

Opportunity for growth. Access to larger markets.

Secure better competitive positions. Expansion of service offerings and

integration of competencies. Broader base of experienced

management. Financial benefits: Lower financial risk. Access to investment capital. Shared (reduced) marketing costs. Lower production and operating costs,

improved use of resources. Reduced Risks.

Access to new technologies and areas of activity

Growth capacity

Share Holder Value Creation

JV AND ALLIANCES SCHEMESJV AND ALLIANCES SCHEMES

JV SCHEMES

Value added product representations

Cooperation agreements with existing companies

Technology transfer / New development agreements

Investing in ongoing business for technological and operational improvements, expansions or new product development

Investing in new business or facilities

Value added product representations

Cooperation agreements with existing companies

Technology transfer / New development agreements

Investing in ongoing business for technological and operational improvements, expansions or new product development

Investing in new business or facilities

Identification of interest Organized workshops MOU Joint market analysis and

development JV commitment Commitment to invest

Identification of interest Organized workshops MOU Joint market analysis and

development JV commitment Commitment to invest

JV EVOLUTION

Strategy First,

Deal Making Second

WHY VENEZUELA: WHY VENEZUELA: CONFIDENCE AND COMPETITIVINECONFIDENCE AND COMPETITIVINESSSS

Most prolific hydrocarbon region outside of the middle east

Attractive Geographic Location.

A strong, long established and demanding industry based on international standards, with a competitive supply sector.

More than twenty private oil companies operate in Venezuela ranging

from large multinational to small local companies.

A free market economy subscribed to the WTO.

Substantial development plan for the coming years.

A tradition of respect to private investment.

A modern legal framework.

The right attributes to develop competitive advantages

THE ROAD AHEADTHE ROAD AHEAD

•The process will continue, the opportunities are there.

•Objective: Identify business areas of mutual interest.

Emphasis on: Schemes:

> Gas > Manufacturing of G&S

> Refinery > Supply of G&S > Alliances

> Petrochemicals > Operation > Investment

> Use of Refinery Streams > Technology Transfer > Financing

•The process will continue, the opportunities are there.

•Objective: Identify business areas of mutual interest.

Emphasis on: Schemes:

> Gas > Manufacturing of G&S

> Refinery > Supply of G&S > Alliances

> Petrochemicals > Operation > Investment

> Use of Refinery Streams > Technology Transfer > Financing

Focus on development and creation of value

Small business enterprises

Hospital and School support

Training and Formation

Educational and HealthPrograms

Social TrainingPlans

Human development projects

The Venezuelan oil private sector is committed to the development of the country and

understands that this development has to reach all Venezuelans.

We understand our responsibility to create well paid, sustained and productive

employment as the long term solution to the problems that impair our society today.

But we also understand that the actual situation does not permit us to sit and wait for

the long term.

Today we are active and committed, the Chamber promotes and stimulates Social

Responsibility as Corporate Strategy, integrating efforts with contributions in social

investment and sustainable development directed to the areas of: