Venezuela’s PDVSA Purchases 49% of Dominican Refinery

Merida, May 6, 2010 (venezuelanalysis.com) – Venezuela and the Dominican Republic signed four accords on Wednesday aimed at strengthening cooperation in the fight against drug trafficking, bringing economic growth and integration to the Caribbean region, and increasing Venezuela’s participation in the Dominican oil market.

The highlight of the official visit, which took place in Santo Domingo, was the purchase of 49% of the state-owned Dominican oil refinery Refidomsa by Venezuela’s state oil company, PDVSA, for $130 million.

Venezuelan President Hugo Chavez, whose policies are based on the ideas of “21st Century Socialism,” said the purchase will help “eliminate the intermediaries of the world capitalist system” so that “some day the Dominican Republic may be really independent and have true energy sovereignty.”

The refinery produces more than 30,000 barrels per day, about a third of what the Dominican Republic consumes. Venezuela said it plans to help expand the refinery, and is committed to satisfying the Dominican Republic’s demand for crude oil.

“If you never find one barrel of oil or one molecule of natural gas in Dominican territory, all that you need will be there in your sister nation, Venezuela,” said Chavez during a press conference with Dominican President Leonel Fernandez.

Chavez also said the purchase of the refinery was important because “it puts us in the heart of the Caribbean,” and would facilitate the delivery of Venezuelan oil to earthquake-torn Haiti. Venezuela already refines oil in Curacao, Cuba, and Jamaica, and has expressed its interest in exploring the possibility of solar, wind, and geothermal power in the Caribbean basin.

Venezuela currently supplies nearly 120,000 barrels per day of discounted oil to 18 Caribbean countries through Petrocaribe, a Caribbean integration organization that Venezuela initiated in 2005. Petrocaribe has also invested more than $220 million in social development programs, including the replacement of incandescent light bulbs with fluorescent ones in the Dominican Republic, through a special fund held in the bank of the Bolivarian Alliance for the Americas (ALBA), an eight-member Caribbean and South American integration bloc based on the principles of solidarity, cooperation, respect for sovereignty and self-determination, and human and social development.

During Wednesday’s visit, the Dominican president thanked Venezuela for creating “a new conceptual framework for establishing ties and relations” through Petrocaribe during difficult previous years when the price of oil soared above $100 per barrel.

“While in some parts of the world they used the high oil prices to speculate because their logic was to maximize profits and capital, Venezuela took advantage of the crisis to show its ethic of solidarity, generosity, and cooperation,” said President Fernandez on Wednesday.

“Venezuela is showing the world a sense of leadership, a vision in which the ethic of cooperation, brotherhood, and humanization among the peoples of the world,” Fernandez continued.

In other accords, Venezuela and the Dominican Republic agreed to carry out a market study to identify potential areas of cooperation, such as in agricultural irrigation, technical training, heavy industries, and construction materials.

The two countries also agreed to increase cooperation in the fight against drug trafficking through land, air, and sea operations as well as programs to prevent the consumption of narcotics and crime generated by the drug trade.

Chavez said the United States and its principal Latin American ally, Colombia, ingenuously accuse Venezuela of not cooperating in the fight against drug trafficking. “They point at us like we are a paradise of drug trafficking, but it is a political manipulation, it is a phenomenon that does great damage to us, the violence and the drug trafficking,” he said.

In telecommunications, an accord was signed to broadcast the Caracas-based television channel Telesur in the Dominican Republic. Telesur was founded in 2006 and rivals other western international news agencies by emphasizing Latin American identity, history, and social changes that are currently underway.

Chavez formally thanked Fernandez for presiding over a multi-national conflict management group to mediate the ongoing diplomatic tensions between Venezuela and Colombia in February. The group met in Mexico and was established after Chavez and Colombian President Alvaro Uribe had a verbal dispute during a summit for Latin American and Caribbean Unity days earlier.

In related news, Chavez announced that, in solidarity with Honduran President Manuel Zelaya, who was kidnapped and exiled in a military coup d’etat last June, he will not attend an upcoming European Union-Latin America summit in Madrid if Honduras’s current president, Porfirio Lobo, is invited to represent the Central American nation.

“We’re not asking for much, just that [President Zelaya’s] rights as a politician and citizen be restored and that he be allowed to return to Honduras,” Chavez said.

Porfirio Lobo was elected in an unmonitored election that was ridden with documented human rights abuses and was not recognized by many Latin American and European nations.