What Is Happening To Venezuela's Oil Money?

I found this information today from Columbus Dispatch, but it's a story hot off the AP wire:

It says a few things I found surprising:

1. The long-term capacity of the U.S.'s No. 4 oil supplier to keep pumping crude is under threat because it is spending more on Chavez's ideological agenda than on badly needed investments, industry analysts say.

2. The company is borrowing billions from international lenders, while independent estimates show its output falling.

3. The health of the company's finances is a subject of debate, mainly because audited financial results have not been publicly released for the past two years.

4. A recent report by the Caracas-based economic institute CIECA estimated that Venezuela's oil company had a net loss of $3.7 billion in 2006, a year when most major oil companies posted record profits.

5.the company handed over about 70 percent of its gross revenue to the state, including $28.7 billion in taxes, royalties and dividends, and $9.9 billion for other social spending.

6. The oil company is also footing the bill for nationalizing power companies and buying majority stakes in oil projects in the Orinoco River region from BP PLC, ExxonMobil Corp., Chevron Corp., ConocoPhillips Co., France's Total SA and Norway's Statoil ASA.

Considering the fact Chavez changed the way foreign oil companies did business in Venezuela so drastically in the last few years, and he himself admits foreign investment in the oil industry was down 55% last year, it is no surprise that now he's pushing for bonds to the tune of 5 billion dollars. This on top of a getting one billion dollar loan from a French bank and 3.5 billion dollars in advance from Japan.

Now, Rafael Ramirez, the oil minister, and Chavez appointed head of PDVSA, says everything is just fine financially. He claims the money is for expansion so they can reach a quota of 5.8 million barrels per day by 2012. The problem with that is they have, for years claimed substantially more output in barrels per day than either OPEC or IEA reports show. While the Venezuelan government has been claiming 3.3 billion barrels per day in output, OPEC and IEA claim it's never been higher than 2.7, and it's really around 2.4 billion barrels. That, to me, is a huge difference. That is 328.5 BILLION barrels a year difference! And it's a myth being perpetuated for years!

Ah, the goose that lays the golden egg is always, it seems, in peril.