***ES QUE HAY ALGUIEN QUE AUN DUDE DE LA ESTUPIDEZ DE EVO MORALES?
Albert Einstein said once “madness was the incessant repetition of the same process, always expecting to obtain a different result”. He was not thinking of the Bolivian state-owned petroleum company, YPFB, but he could have been. This company has been created and recreated four o even five times during the last 80 years. Every time it collapses, the hydrocarbons industry in Bolivia gets a shot in the arm, the reserves increase, plant and equipment are renovated and operations become normal and, even, prosperous. But as soon as the government decides to nationalize this industry again, in the name of sovereignty, and brings YPFB back to life, things start to deteriorate once more. In 1968 YPFB employed 4200 people to produce 8000 barrels of oil per day while neighbor Gulf Oil employed 200 people to produce 33000 barrels per day from another Bolivian oilfield. Every minister brought his own people to work in the company. The profit motive became a bad word since the company had to have social objectives, whatever this means.
The history of nationalizations in Bolivia has been a history of tragic failures, driven by the stupid notion that only the State can guarantee national sovereignty and control “strategic” companies. With the arrival of Evo Morales in the presidency the political stage was set for the newest chapter of this soap opera. Elected President Morales promptly arrived in the oilfields with the Bolivian army and accused the foreign companies of stealing Bolivia’s treasures. Some of the managers of the private oil companies were even put in prison (Repsol) and humiliated, as if they were criminals. Morales planted, once more, the Bolivian flag in the oil and gas fields of the country. YPFB, the state owned Hydrocarbons Company was reborn, by the fifth time or so, from its ashes.
A few days ago Evo Morales named the fifth president of YPFB in only two years. The new president is a politician. In his first speech he said he would put YPFB back on track, that he would create the new YPFB. He had arrived at his desk because of the corruption, nepotism, disarray in the organization, losses of production and hunger strikes that had characterized the tenure of the previous president, Mr. Aruquipa. In turn Mr. Aruquipa had replaced Mr. Morales (no kin to Evo) after a corruption scandal. Before Mr. Morales two other bureaucrats, Mr. Ortiz and Mr. Alvarado, equally inept/or corrupt, had been in charge. It does not matter that, according to YPFB’s regulations, the president would need to have ten years or more of’ experience in the hydrocarbon industry. Mr. Santos, the new president, has probably only seen a drilling rig in photographs but Evo wanted a man he could trust in this position.
Predictably, the new president also said that YPFB needed money, that the company had no money, that the government had a lot of money, some $6 billion, in international reserves and that YPFB needed some of that money. It is paradoxical that an oil company should be asking the state for money, when its reason for existing is to provide the state with money. YPFB asking Evo for money sounds like a fraud to me. It is, in fact, a fraud, not only because it is asking for money but also because it will be asking for money tomorrow and the day after. And the reason is simple: YPFB does not have a management team, they do not have technicians, they do not have procedures and they have no clear objectives. The company is what it always has been (with some brief bright spots): a very incompetent outfit, often corrupt, without decent management or clear sense of direction.
How long will the fifth president of YPFB be there? No one knows, probably a few months. It does not matter. The next one will be as inept as this one because what makes an organization is not the name of the leader but technical competence, professional management, clear strategic objectives, motivated employees and the profit motive. YPFB has none of these components and will never have it, as long as the likes of Evo Morales are running the country. Petrobras could certainly tell them how to behave but they prefer to talk with equally corrupt and equally inept Petroleos de Venezuela.
What a bunch of criminal clowns!
Albert Einstein said once “madness was the incessant repetition of the same process, always expecting to obtain a different result”. He was not thinking of the Bolivian state-owned petroleum company, YPFB, but he could have been. This company has been created and recreated four o even five times during the last 80 years. Every time it collapses, the hydrocarbons industry in Bolivia gets a shot in the arm, the reserves increase, plant and equipment are renovated and operations become normal and, even, prosperous. But as soon as the government decides to nationalize this industry again, in the name of sovereignty, and brings YPFB back to life, things start to deteriorate once more. In 1968 YPFB employed 4200 people to produce 8000 barrels of oil per day while neighbor Gulf Oil employed 200 people to produce 33000 barrels per day from another Bolivian oilfield. Every minister brought his own people to work in the company. The profit motive became a bad word since the company had to have social objectives, whatever this means.
The history of nationalizations in Bolivia has been a history of tragic failures, driven by the stupid notion that only the State can guarantee national sovereignty and control “strategic” companies. With the arrival of Evo Morales in the presidency the political stage was set for the newest chapter of this soap opera. Elected President Morales promptly arrived in the oilfields with the Bolivian army and accused the foreign companies of stealing Bolivia’s treasures. Some of the managers of the private oil companies were even put in prison (Repsol) and humiliated, as if they were criminals. Morales planted, once more, the Bolivian flag in the oil and gas fields of the country. YPFB, the state owned Hydrocarbons Company was reborn, by the fifth time or so, from its ashes.
A few days ago Evo Morales named the fifth president of YPFB in only two years. The new president is a politician. In his first speech he said he would put YPFB back on track, that he would create the new YPFB. He had arrived at his desk because of the corruption, nepotism, disarray in the organization, losses of production and hunger strikes that had characterized the tenure of the previous president, Mr. Aruquipa. In turn Mr. Aruquipa had replaced Mr. Morales (no kin to Evo) after a corruption scandal. Before Mr. Morales two other bureaucrats, Mr. Ortiz and Mr. Alvarado, equally inept/or corrupt, had been in charge. It does not matter that, according to YPFB’s regulations, the president would need to have ten years or more of’ experience in the hydrocarbon industry. Mr. Santos, the new president, has probably only seen a drilling rig in photographs but Evo wanted a man he could trust in this position.
Predictably, the new president also said that YPFB needed money, that the company had no money, that the government had a lot of money, some $6 billion, in international reserves and that YPFB needed some of that money. It is paradoxical that an oil company should be asking the state for money, when its reason for existing is to provide the state with money. YPFB asking Evo for money sounds like a fraud to me. It is, in fact, a fraud, not only because it is asking for money but also because it will be asking for money tomorrow and the day after. And the reason is simple: YPFB does not have a management team, they do not have technicians, they do not have procedures and they have no clear objectives. The company is what it always has been (with some brief bright spots): a very incompetent outfit, often corrupt, without decent management or clear sense of direction.
How long will the fifth president of YPFB be there? No one knows, probably a few months. It does not matter. The next one will be as inept as this one because what makes an organization is not the name of the leader but technical competence, professional management, clear strategic objectives, motivated employees and the profit motive. YPFB has none of these components and will never have it, as long as the likes of Evo Morales are running the country. Petrobras could certainly tell them how to behave but they prefer to talk with equally corrupt and equally inept Petroleos de Venezuela.
What a bunch of criminal clowns!
This was an excellent piece Gustavo.
ResponderEliminarI know that Venezuela is your primary interest, but I must say it is very obvious to me that you both know and understand the oil business. I see that your personal background is in Petroleum Geology, which I am sure explains it.
Perhaps at some point you might consider explaining the stakes to the public at large of the pending referendums on autonomy in Bolivia, where six departments are almost certain to vote for separating themselves -- and most importantly their petroleum riches in oil and natural gas -- from the rest of the country. I think this information would be very valuable and it is not widely known or understood. And I mention this because I do not rule out the possibility that Evo's MAS thugs will turn to violence, they actually have made that turn already so maybe I should say "will turn up the violence," as a response to that impending vote. I fear for Bolivia when I think of what may lie in its immediate future because I see a poisonous nature to the program Evo and his MAS party have been pursuing since his election.
I would love to hear your take on all of this. My late father was a petroleum engineer who worked for over 40 years in the oil business in Louisiana, a good portion of the south central U.S., and elsewhere around the world. He spoke with the same condemnatory tone of government-run oil companies that I read in your writings.
And you have one of the finest blogs anywhere on the internet. You never disappoint.
Y sí, leo los blogs en Español con el mismo interés que traigo a sus artículos en inglés.
Jacob Sulzbach
Lafayette, Louisiana