Mérida, August 9, 2007 (venezuelanalysis.com)— Continuing his South American tour, Venezuelan President Hugo Chavez departed from Uruguay yesterday where he signed energy agreements with President Tabaré Vazquez, and headed on to Ecuador where he met with his friend and colleague President Rafael Correa. In Quito, the two leaders signed energy agreements including an agreement to build a joint oil refinery in Ecuador.
In the Uruguayan capital, Montevideo, Chavez signed an energy agreement with the Uruguayan president to supply oil to the region "for the rest of the century," he said. In addition, the two presidents signed an agreement to create a joint company between Venezuela’s state oil company PDVSA, the Uruguayan Ancap, and Enarsa of Argentina, with an investment of more than 20 billion dollars.
Venezuela now sells petroleum to Uruguay under special conditions that allow for Uruguay to pay 75 percent up front and the remaining 25 percent over a period of 15 years with 2 percent interest. At the same time, Uruguay has begun to export dairy cows to Venezuela as a part of several agreements signed between the countries since 2005.
Other new energy agreements during this visit include the expansion of an Uruguayan refinery to double its productive capacity and the construction of a gas refinery to supply Venezuelan natural gas to Uruguay, although Chavez admitted that his project for a gas pipeline from Venezuela to the southern cone has been put on hold for the moment.
The two countries are also studying the possibility of constructing a factory to produce insulin. Chavez indicated that with an investment of several millions of dollars the factory would be the biggest insulin factory on the continent.
"Uruguay has the patent and the technology for the production (of insulin), but they don’t have the financial resources," said Chavez yesterday. This plant would have the capacity to produce enough insulin to supply the whole continent and, in this way, it would "unhitch us from the transnational medical companies that exploit our populations," Chavez assured.
Venezuela and Uruguay have increased their integration in the last few years, signing around 80 different agreements and cooperative projects. The Uruguayan president recognized the efforts made by the Venezuelan government to increase this cooperation.
"I want to thank Venezuela for what they have done, their government and their population; generosity like which I don’t know another example that they have been willing to offer Uruguay and put in motion the extraction of oil that Uruguay does not have and to assure us energy for one hundred years," said President Vazquez.
Chavez emphasized that his country is looking to supply many nations with oil to allow them to "detach" from dependency on the United States, although he assured that they would not cut Venezuela’s supply to the United States.
Chavez then went on to Ecuador last night where he arrived late due to delays in the activities in Uruguay. In Quito, the Venezuelan president and President of Ecuador Rafael Correa are planning more energy agreements and plans for economic integration.
Among the most important of these agreements is the plan to build a joint oil refinery in Ecuador with the capacity to process around 300,000 barrels of oil per day. The plant will refine oil from both Venezuela and Ecuador and will reduce the amount of oil derivatives that Ecuador has to import.
Chavez criticized the previous development model used in Ecuador in which nearly all the money the country received from exporting crude oil was then used to import oil derivatives.
"They sell a barrel, for example, at 50 or 60 dollars and then they have to buy gasoline at 80 or 90 dollars," Chavez explained. "That is the model that was imposed on Ecuador, a colonial model. We have come to help liberate Ecuador."
Chavez made the same offer to Ecuador as he did in Argentina and Uruguay, to supply the region with its energy supplies for the next 100 years. Chavez’s plan to supply the region with energy has the intention of increasing regional trade and integration.
Along with offering a constant oil supply to Ecuador, the two presidents also signed an agreement to promote the development of small and medium-sized industry in both countries. In a joint project the National Institute of Socialist Formation in Venezuela will work together with the Center of Formation and Education of Ecuador to organize sustainable projects within the new economic processes.
Chavez is also expected to inaugurate the Venezuelan Bank of Social and Economic Development (Bandes) in Quito to finance development projects in the country.