September 29, 2005
Chávez proposes to expand South American oil alliance

(AP Worldstream) - "Venezuelan President Hugo Chávez said he is seeking to share his country's oil wealth with every nation in South America, aiming to strengthen ties while offering an alternative to the U.S.-backed Free Trade Area of the Americas.

Chávez says his 'Petroamerica' initiative is intended to reach countries across the hemisphere, and that Venezuela has ample reserves to help the region deal with high oil prices for generations to come (...)

'With this mission of energy integration, Venezuela guarantees petroleum and gas for the South American continent for at least 200 years,' he said.

Chávez said Venezuela and Brazil will jointly exploit an oil block in the Orinoco tar belt, and that further deals were planned with Argentina and Uruguay. Officials also announced Brazil and Venezuela agreed to share the cost of building a new US$2.5 billion (A2.08 billion) refinery in northeastern Brazil to process up to 200,000 barrels of crude a day.

Few specifics have been released of future deals under the Petroamerica initiative, but some of its aims include stepping up refining capacity and promoting joint exploitation of oil and natural gas.

Officials have not excluded the possibility that Chávez may also extend new offers of oil sales under preferential terms as he has before.

'Everyone on the continent is looking with a lot of interest,' Santiago Chávez, a trade official from Ecuador's embassy in Venezuela said after energy ministers from 12 South American countries signed a declaration in Caracas pledging to pursue the Petroamerica initiative.

Uruguay's energy subsecretary, Martín Ponce de León, has said one example of the type of integration under consideration was a plan for Venezuela to help expand a refinery in Uruguay to process 50,000 barrels of heavy crude a day.

Officials say Petroamerica will integrate previous cooperative oil projects _ Petrosur, Petrocaribe and Petroandina _ under which Venezuela has agreed to sell fuel to other countries in the region under preferential terms and with low-interest financing.

In June, Chávez signed the Petrocaribe deal with 13 Caribbean countries to sell 190,000 barrels of fuel a day under terms that are expected to save them millions of dollars (...)".