Mérida, August 22, 2008 (venezuelanalysis.com)– The southern section of Venezuela’s Orinoco Oil Belt region will become a “Special Use Area” where the planned Socialist Development Project of the Orinoco will be administered by an appointed federal authority, Venezuelan President Hugo Chávez told his cabinet ministers on Wednesday.
“This grand belt is going to be one of the greatest projects of the 21st Century, I would say the greatest,” Chávez told his ministers.
The purpose of the project is to assure “integral development,” meaning agricultural and social investments accompany the oil exploitation in the Orinoco region, which is estimated to contain the world’s largest oil reserves, Chávez explained.
“We cannot wait for the Sow Petroleum Plan to be halfway through or more than halfway before starting the Socialist Development Plan of the Orinoco, no! It is simultaneous,” said the president during the nationally televised meeting with his ministers.
The state oil company PDVSA will be a prime mover of the project, “because this company has the resources, and I know they are going to do it,” said Chávez.
Flipping through the pages of Venezuelan laws in front of television cameras, the president, who has been painted as dictatorial by opposition-controlled media, read aloud the National Assembly-approved laws governing the Special Use Areas.
Article 37 of the Organic Law on Territorial Ordering and Planning, passed by the National Assembly in 2005, defines a Special Use Area as having “special characteristics” which require it to be under “special management to fulfill specific objectives of general interest” such as the sustainable use of natural resources, the protection and recuperation of degraded areas, and national defense.
Article 42 of the same law stipulates that Special Use Areas must be established by the president with his or her council of ministers.
The 55,000 square kilometer area to the South of the Orinoco River Basin will be pumped with an 878 million bolivar ($408.4 million) initial investment to set up 13 working camps to organize dozens of planned projects.
Chávez envisions that 160,000 hectares (64,700 acres) of land will be planted with yucca, soy, corn, sorgum, and beans, and a soy oil processing plant will be constructed nearby. Another part of the zone is apt for producing long-fiber cotton, according to the president.
Chicken farms with a capacity of 30,000 tons per month, massive cattle and pork farms, grain processing and food packaging plants to substitute imports and satisfy Venezuela’s growing demand for food amidst global shortages and price inflation.
Along with these agricultural projects, Chávez presented plans for four large oil refineries that can process the extra-heavy Venezuelan crude, one of them big enough to refine 400,000 barrels per day of oil.
To facilitate all this growth, the ministers discussed a series of infrastructure repairs and expansion, including a 660-kilometer freeway and housing projects for the local population.
The president will appoint a federal authority to administer the Special Use Area and steer these projects in line with the national development plan for the years 2008-2012.
Chávez was granted the power to appoint these authorities, which do not fall into line with traditional public offices such as mayors, governors, or elected legislatures, by the Organic Law on Public Administration when it was first passed in 2001.
Article 70 of the newest version of the law, passed by presidential decree three weeks ago, explains the power more explicitly: “The president of the Republic will designate regional authorities, who will have as a function the planning, execution, follow-up, and control of the policies, plans, and approved projects of the ordering and development of the territory in conformity with the centralized planning.”
In an interview with the government television station after the meeting with his ministers, Chávez said the Orinoco plan, like the nationalization of key sectors of the Venezuelan economy, are part of a national plan that aims to develop social forms of property.
For example, the recent nationalization of the cement industry should lead to “small factories of communal property in which the organized people accelerate the solution to the housing problem,” said the president, adding “it is the State and the power of the communities that will achieve it.”
“The state will assume the fundamental role in the economic stimulus of Venezuela,” he told the host of the political talk show Dando y Dando.