Peruvian Unit Of U.S. Firm Is Nationalized --- HNG/InterNorth May Face Write-Off; Occidental Averts a Similar Fate

Peru's state oil company, Petroperu, took over the operations of HNG/InterNorth Inc.'s Belco Petroleum Corp. of Peru unit, under orders from Peruvian President Alan Garcia. In addition, Occidental Petroleum Corp., which also was threatened with expropriation, worked out a new exploration a...

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Bibliographic Details
Published inThe Wall Street journal. Eastern edition
Main Author This article was prepared by Mark Zieman in Houston, Jonathan Cavanagh in Lima, Peru, And Brenton R. Schlender in Los Angeles
Format Newspaper Article
LanguageEnglish
Published New York, N.Y Dow Jones & Company Inc 30.12.1985
EditionEastern edition
Subjects
Agreements
Corporate profits
Crude oil prices
Nationalization
Oil exploration
Presidents
Tax credits
Tax exemptions
Tax rates
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Summary:Peru's state oil company, Petroperu, took over the operations of HNG/InterNorth Inc.'s Belco Petroleum Corp. of Peru unit, under orders from Peruvian President Alan Garcia. In addition, Occidental Petroleum Corp., which also was threatened with expropriation, worked out a new exploration and production contract with Peru under which the Los Angeles-based company promised to expand exploration in return for new acreage. Another company, OxyBridas, a consortium formed by Occidental and Bridas Exploraciones y Produccion of Buenos Aires, Argentina, will continue to operate in Peru under terms of a contract that allows it to deduct exploration expenses from taxes. Mr. Garcia said Belco had failed to come up with "reasonable counterproposals" to his demands for new investment commitments, higher tax payments and repayment of tax credits. Mr. Garcia said HNG/InterNorth would be compensated for the expropriation after Peru deducts about $50 million in taxes that the government claims it is owed by Belco.
ISSN:0099-9660