Mérida, April 8, 2010 (venezuelanalysis.com) - During Uruguayan President Jose “Pepe” Mujica’s visit to Caracas on Wednesday, Venezuela and Uruguay renewed agreements to exchange Venezuelan oil for essential agricultural and manufacturing supplies, in what Mujica called a step toward “Latin American Unity.”
Through the Caracas Energy Cooperation Agreement, originally signed in 2005, Uruguay will now receive more than 40,000 barrels of oil per day. As part of the deal, Uruguay will pay a quarter of the cost over the course of fifteen years, with a two-year grace period and two percent interest rate.
Venezuelan President Hugo Chavez said his country could supply Uruguay with natural gas, and proposed the construction of a gas liquefying plant in Uruguay. The two countries also discussed the upgrading of Uruguay’s La Teja refinery so that it may process crude oil from Venezuela’s Orinoco Oil Belt.
“All the gas that Uruguay needs, all the petroleum they need for this century is in Venezuela, for the advancement and development of the Uruguayan people,” Chavez said during a public accord signing ceremony in Caracas.
Venezuela’s estimated natural gas reserves are projected to become the fourth largest in the world, and its Orinoco petroleum reserve is one of the world’s largest. Venezuela’s principle oil trading partner has long been the United States, but Chavez has signed deals to dramatically increase oil exports to nations in Latin America, Africa, Asia, and Europe since his election more than a decade ago.
Alongside Chavez, and in between musical performances by Uruguayan and Venezuelan groups, Mujica expressed his gratitude, saying Chavez “symbolizes all of the commitment of the great liberators of historic times.”
“No government, no world power, has offered the solidarity and acceptance that we have received from this country,” said Mujica, referring to Venezuela.
In return for supplying energy to Uruguay, Venezuela will receive scientific, technical, and financial assistance to augment its food production, and will also import 180 metric tons of Uruguayan chicken per month.
Chavez said the accords will help Venezuela satisfy its short term demand for food and help the country produce its own food in the long run, moving away from dependence on oil exports and food imports.
“This is a sacred commitment for use... I give thanks to you and to Uruguay for all the support they continue to give us to achieve food security, on course toward food sovereignty,” said Chavez.
In addition, the two countries agreed to create a binational company boost the exchange of goods and services and “to satisfy the requirements of diverse public and private entities from both countries.”
Venezuela approved import licenses for one thousand Uruguayan cars, and Venezuela’s national oil company, PDVSA, signed an agreement with Uruguay’s state energy company, ANCAP, to construct fuel storage facilities in Río de la Plata, Uruguay.
President Mujica said the accords constituted a step toward regional integration. “If we do not behave badly, if we are not selfish, if we are not chauvinist, if we are not blind... perhaps our grandchildren will be able to see forms of Latin American unity of which today we cannot even dream,” he remarked.
Wednesday’s visit was Mujica’s first since being elected last October. It also came less than a week after Russian Prime Minister Vladimir Putin’s visit to Venezuela, during which similar accords were signed to develop the Orinoco Oil Belt and import Russian vehicles. Later this month, Venezuela plans to receive visits from Argentine President Cristina Fernández and Chinese President Hu Jintao.