Ann: Half Year Accounts, page-48

Hi EB,
From reading the notes to the accounts, my understanding is each of the operating units reports on their operations in their local currencies and aggregated them into our operational profit and loss.

What we are presented here is a consolidated accounts, the adjustments to the inter units activities etc comes after the operational profit and loss line to reflect the group profit.

In the case of PDVSA, my reading is the balance of US$ held in Argentina is reported as an exchange gain to the operational unit ( I would assumed it was reported to headquarters in peso terms). The operating results together with the results from operations from other parts of the world would have then been converted to US$ format and aggregated for our reporting.

In the adjustment below the operational results, it is to take out all the holdings of US$ in the foreign units and reversed that gain.

So for PVDSA, I believe the local components of the cost should now be very much lower on the assumption that there is no room for renegotiation.