Venezuela and Russia Initiate Gas Exploration and Expand Strategic Alliance

Mérida, November 7, 2008 (venezuelanalysis.com)– On Friday, the Venezuelan state oil company PDVSA and the Russian company Gazprom began drilling for gas in the Gulf of Venezuela. Government officials from both energy giants further concretized an alliance with cooperation agreements in a wide variety of areas, including nuclear energy, gold mining, and flights between the two countries.

"The relationship between Venezuela and Russia is of strategic business character," said Igor Sechin, the vice prime minister of Russia, in Caracas.

Venezuelan President Hugo Chavez said the initiation of gas exploration "is as important as launching the Simon Bolivar satellite a week ago," referring to the satellite that China manufactured and launched as part of a bilateral investment accord with Venezuela.

"Now a new stage of history has begun, because we are free, we are not a colony and we make use of our freedom. We have liberated ourselves from imperialism," said Chávez.

According to the president, Venezuela's "Caribbean Gas Belt," stretching along the entire coast, contains 200 trillion cubic feet of natural gas reserves. Last month Chavez announced that Venezuela would build a new naval base on its largest island to defend the reserves.  

"It is a great advantage for Venezuela to count on Russia's presence and the company Gazprom in the Gulf," said Chavez. Venezuela should be able to produce its own gas within five years, thanks to Russia's agreement to transfer technology to Venezuela and train Venezuelan workers, he said.

Also, Chávez announced that on November 26th of this month, Russian President Dmitri Medvedev will visit Venezuela, the first Russian President to do so ever.

Extensive teams of government authorities from the two countries set up more than twenty commissions to manage nearly fifty bilateral projects in education, finances, arms purchases, light industries, mining, infrastructure, energy, telecommunications, science and technology, environment, citizen security, culture, sports, and tourism.

The countries moved forward on several projects that were launched over the past year, including Venezuela's development of civilian nuclear energy, a binational bank, purchases of Russian military equipment, and a joint energy company made up of five Russian firms and PDVSA.

They also discussed the construction of an aluminum plant and automobile factories in Venezuela, and a possible commercial flight between Caracas and Moscow.

According to statements by Venezuela's Basic Industries and Mining Minister, Rodolfo Sanz, on Thursday, the Venezuelan government might grant the Russian mining firm Rusoro partnership with Venezuelan state mining companies in two major gold projects in Venezuela, Las Cristinas and Las Brisas.

Sanz had announced on Tuesday the government's intention to nationalize the two gold deposits, which are currently controlled by the Canadian firm Crystallex and Washington State-based Gold Reserve.

According to Venezuelan Major General Jesus Gonzalez, Venezuela will continue purchasing Russian arms until it has "sufficient strength" to defend its territory and oil.

"I do not doubt that the United States wants to come looking for petroleum here," said Gonzalez. Even with new president-elect Barack Obama, "the end goal and purpose of the United States will be the same: To dominate the world," he said.

Venezuela has purchased $4.4 billion worth of Russian weapons since 2005 and in September Russia approved a $1 billion loan to Venezuela for future arms purchases.

Venezuela's Foreign Relations Minister Nicolas Maduro said, "This alliance with Russia forms part of the effort to construct a multi-polar world" that is based on the principles of "respect for sovereignty, equality among states, and on the basis of a constructive agenda."

Maduro emphasized the need to end war and construct a new financial system to prevent states from dominating other states in order to exploit their natural resources.