Squeezed by slumping crude prices, Venezuela is reaching out to the multinational oil companies it once demonized as imperialist profiteers. Venezuela is soliciting bids from the world''s major oil companies to extract heavy crude from vast deposits in its Orinoco River region, according to the Associated Press. Despite President Hugo Chavez''s criticism of U.S.-style capitalism, it has become clear that state-owned Petroleos de Venezuela SA needs both the cash and expertise of Big Oil. These international oil companies have made windfall profits in recent years, but analysts doubt many will want to invest again given Chavez''s history of seizing foreign stakes in Venezuela''s oil. Venezuela''s oil wealth funded a bonanza of social spending that has made Chavez a populist hero not only in Venezuela, but across much of Latin America. But times have changed since Chavez nationalized Venezuela''s last privately run oil fields in Orinoco in May 2007, shouting "Down with the U.S. empire!" as Russian-made fighter jets streaked overhead. The government took majority control of those projects, siphoning off more of the profits and reducing private companies to minority partners. Exxon Mobil Corp. and ConocoPhillips pulled out altogether, while Chevron Corp. and others begrudgingly accepted the new terms. Venezuela''s oil industry has stagnated under Chavez. Thousands of veteran employees with critical expertise were fired for backing an oil strike in an attempt to oust Chavez from office, even as the payroll expanded by more than half since 2002 to 70,400. Chavez has turned PDVSA into an all-purpose social service agency. An urban development arm builds houses, and a subsidiary sells milk, chicken and beans at metro stations and plazas. The neglect of the company''s core business is evident along the eastern shore of Lake Maraca Ibo, where for every few pump jacks pulling crude, another one hovers motionless above an abandoned well. Here in the petroleum heartland -- home to 78 billion barrels of Venezuela''s most accessible reserves -- machinery lies broken amid the weeds along muddy lakeside roads. Steam hisses from rusted pipes. PDVSA insists output is steady at an average 3.3 million barrels a day. But according to the Organization of the Petroleum Exporting Countries, to which Venezuela belongs, production has dropped 16 percent since Chavez won office in 1998 and averaged 2.4 million barrels a day last year. Chavez has talked often of partnerships with the state oil companies of Iran and Russia -- but falling oil prices have left these countries with less cash to spend on distant projects. PDVSA is in an extremely tight spot, with oil prices plummeting more than 70 percent since July. Venezuela''s heavy crude is particularly expensive to upgrade to usable crude -- not a problem when prices were sky-high. Now shrinking profit margins make it harder to finance production. Venezuela also needs new upgrades to make this extra-heavy crude refine-able -- which is why PDVSA is requiring bidders to help build three of the facilities. Oil Minister Rafael Ramirez each would cost $6 billion, to be completed by 2014. PDVSA says it has invited bids for minority stakes in projects to explore seven areas of the Orinoco delta, and that 19 companies, including Chevron Corp., Total SA, Royal Dutch Shell Plc and Petroleo Brasileiro SA, spent $2 million each for a "data package" of technical information about the deposits. But it remains unclear whether any have actually presented bids. Chavez''s history of nationalizations and tax hikes is surely fresh on the oil executives'' minds. The world''s major oil companies may end up bidding on the Venezuelan projects in the end, simply because global supplies are dwindling, and much of the remaining reserves are locked up by governments from Iran to Mexico. But first, Chavez may have to find ways of reassuring them that he won''t seize their investments again.