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Last Updated: Wednesday, 30 August 2006, 16:03 GMT 17:03 UK
Chad oil tax row 'not asset grab'
Chad President Idriss Deby
Deby described Chad's stance on oil as a "revolution"
Chad has softened its demands for a stake in the country's oil consortium, but is still insisting that two firms involved owe $500m (263m) in taxes.

In a surprise move last week, Malaysian state oil firm Petronas and US company Chevron were ordered to leave Chad by President Idriss Deby.

Mr Deby initially said Chad should have a 60% stake in the consortium - the same share that the two firms now hold.

He has now launched a commission to renegotiate a stake with the firms.

Government officials, MP's, trade unionists and others will sit on the commission, local media reported.

'No connection'

Petronas denies being in arrears on contractual tax payments, and a delegation from Malaysia is due in Chad to try to iron out the dispute.

A spokesman for the president said that there was no connection between the establishment of the commission and the tax row.

"That negotiation has nothing to do with the renegotiation of the oil agreements... Those are two different matters," Dieudonne Djonabaye, the president's deputy communications director said.

He told Reuters news agency: "The state wants to join the consortium agreement... That doesn't mean that Chad will take the 60% [of Petronas and Chevron]."

The government and Exxon Mobil, which has a 40% stake in the consortium, would "provisionally" run it, he said.

"If Petronas and Chevron agree to pay [their tax dues], they will be associated with the renegotiation," he added.

'Clear message'

In a speech on Wednesday, the president did not refer to expelling the firms but demanded payment of $500m.

The BBC's Stephanie Hancock in the capital, N'Djamena, said that the message sent out by the president was clear: Chad wants control of its own oil and it wants it now.

Addressing a crowd outside his palace, Mr Deby said that a "revolution" had begun.

Petronas said it was working to find an "amicable solution" but insisted it had met all obligations to Chad, including tax. Chevron also says it has paid the taxes it should.

Exxon-Mobil holds the remaining 40% stake in the consortium.


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