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Good or Bad for Colombia? Venezuela's Chavez Expands Oil Initiative

Just want your opinions on this. I think it would be a great thing for South America as a whole. Maybe things like this will foster better relations between the countries. Please no diatribes on Chavez. Just trying to focus on this idea.

http://news.yahoo.com/s/ap/20050929/ap_on_re_la_am_ca/venezuela_oil_diplomacy

Venezuela's Chavez Expands Oil Initiative
By NATALIE OBIKO PEARSON, Associated Press Writer
2 hours, 9 minutes ago

CARACAS, Venezuela - President Hugo Chavez said Thursday he wants to share his country's oil wealth with every nation in South America, in a move that aims to strengthen alliances in the region on the back of surging energy prices.

Chavez, a close ally of Cuban leader Fidel Castro, said his country had enough resources to help the region 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," Chavez said as he arrived for a South American summit in Brazil's capital of Brasilia.

Venezuela's "Petroamerica" initiative is a rival to the U.S.-backed Free Trade Area of the Americas. It integrates previous oil projects Petrosur, Petrocaribe and Petroandina, under which Venezuela agreed to sell fuel to other countries in the region on preferential terms.

Chavez has said the energy alliances will challenge U.S. economic domination in the region, and distribute fuel directly to avoid costly intermediaries.

Venezuela and Brazil will jointly exploit oil in the Orinoco tar belt, Chavez said, and further deals are planned with Argentina and Uruguay. Officials also announced Thursday that Brazil and Venezuela had agreed to share the cost of building a new $2.5 billion refinery in northeastern Brazil to process up to 200,000 barrels of crude a day.

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

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

In June, Chavez 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.

Eleven of those countries have since signed more specific deals allowing them to pay only a portion of their debt up front and finance the rest over 25 years at low interest rates. Venezuela has also said they can pay some debts with goods such as rice, bananas or sugar.

Some have accused Chavez of taking advantage of a tight oil market to buy political alliances.

"Who doesn't do that?" asked Professor Mazhar al Shereidah, an oil expert at Central University of Venezuela. "Why would it (Venezuela) lose this opportunity?"

By toneloc24 on Sep 29, 2005, 15:10 in Politics & the war.

juancegomez says on Sep 29, 2005, 16:41:

I usually think is a good ide I usually think it is a good idea, in theory. How Chavez puts it in practice and the consequences of his actions will be another matter, for better or for worse.

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platano says on Sep 29, 2005, 17:53:

Sharing is always a good idea and I have no problem with Chavez however, I think the idea is unrealistic and his projections are unrealistic. What we really face is three-way race between "easy" oil, population growth, and the continuation of the world economy -- alternative forms of energy nonwithstanding. I don't think we are going to make it.

Some results of World Oil Forecast #10 follow: Assume that Peak Oil occurs in 2008 at 30.6 Gb (i.e., between 30.6 in 2007 and 30.5 in 2009). Then world oil production falls to 22.2 Gb in 2030 (a decline of 27.5%) and to 16.7 Gb in 2040 (a decline of 45.4%). This assumes that the world EUR = 2,750 Gb, including the Canadian “tar sands” and the Venezuelan “heavy” and “extra heavy”. Should these later sources falter, then world oil production will decline much faster than indicated by our Forecast #10.

Chavez believes he has enough oil "for generations to come"... I think that is a dream.

Plátano X
Oxigeno Verde ¡Libertad por Ingrid y los demás!

plátano

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Mr. Hollywood says on Sep 29, 2005, 18:10:

My suggestion for Hugo My suggestion for president Chavez is that if, out of the goodness of his heart, he really wants to help the poor countries of Latin America, he should sell his oil to the highest bidder and use those profits to buy down the foreign debt of countries like Ecuador, Bolivia and Peru. Of course that wouldn't create long-term dependency on Venezuelan oil...

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platano says on Sep 29, 2005, 22:25:

Mr. H., I am curious. Is there any country in the world professing a good heart which has taken the approach you suggest? Or would Chavez be breaking new ground here?

plátano

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platano says on Sep 30, 2005, 06:33:

Tinto, Mr. Chavez has shot himself in the foot... In Venezuela In 2004 oil production was 2.58 mb/d, NGL production was 395.000 b/d and unconventional oil production was 548.000 b/d. Giving a total liquids production of 3.52 mb/d. An annual decline rate of 4% over 2004 oil production has been added. NGL and unconventional oil production is assumed to stay stable. Above this a total of 3 new projects are coming on-stream adding 298.000 mb/d.

Specific information:

On the other hand, the loss of 18,000 employees who were fired for joining the anti-government strike could make it difficult for the company to counter normal oil production capacity depletion rates for Venezuela of an estimated 25% per year.

After a strike that resulted in a near complete shutdown of PdVSA's operations in late 2002 and the early months of 2003 and in a loss of nearly half its employees, current oil production levels in Venezuela are a bit uncertain. While PdVSA insists that oil production has recovered to pre-strike levels, outside observers, as well as former PdVSA employees, claim that production remains considerably lower.

SOURCE: http://www.peakoil.nl/images/oil_production_outlook_2005-2040.pdf

Plátano X
Oxigeno Verde ¡Libertad por Ingrid y los demás!

plátano

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vladimiro says on Sep 30, 2005, 10:23:

Interview with President Lagos of Chile Chile's new president talks about Latin AMerican integration and other interesting subjects in this interview at the "The Hindu".

Varadarajan: Given the enormous distance that separates
Latin America from South Asia, what is it that India and Chile can do
for each other?

Ricardo Lagos: That reminds me of my visit to China when President
Jiang Zemin told me, `You are from such a faraway country, I assume
you have something very important to tell me!' But seriously, beyond
the historical things and the multilateral issues, India is an
emerging country, extremely important as an economic force. Chile is a
small country with only 15 million people but our path of development
has been to integrate with the world. Trade accounts for more than 65
per cent of our GDP, and if we add services, that's 80 per cent. In
other words, India has a huge internal market but when you are a small
country, you see the world. And we would like to be here.

Varadarajan: There's a perception that Chile prefers to remain aloof
from regional integration in South America and reach its own
understanding with the U.S. on trade.

Lagos: Every country has different realities. As I said, 65 per cent
of our GDP is represented by exports and imports. Do you know how much
it is in Brazil? 22-23 per cent. Argentina has something similar.
Because these countries are so huge, the internal market is very
important for development. The way you address the issue of trade is different when you have such a huge market.

Varadarajan: So Chile does not want to become a full member of
Mercosur?

Lagos: I'm in favour of Latin American integration. And I think this
is essential. But how are we going to integrate if you have 14 per
cent tariff and I have 6 per cent? Should I increase my tariff? That's
impossible. Should they reduce? In the long term, they are planning
that. So the question of integration has to do with what is the
reality in the different countries. Why don't we have integration in
the political arena?

"The Globalized World Needs Rule of Law"

http://svaradarajan.blogspot.com/2005/01/globalised-world-needs-rule-of-law.html

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BAQ says on Oct 2, 2005, 11:59:

Chavez Well, just a thought, but it appears Chavez is trying to expand his "Circle of friends" in South America and what better way than to use his OIL. I suspect Chavez feels somewhat "Isolated" given the fact Bush hates the guy so "Better to have all the local friends you can get" when ya know the U.S. is pissed off at you, especially when you consider Colombia is backed/supported by the U.S.

Semper Fidelis !

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aztec says on Oct 5, 2005, 04:09:

"Hugo Chavez Denies Seeking Dictatorship" The world never seems to learn from history especially in South America. Those poor people are slowly voting themselves a dictatorship!

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