Venezuela Offers China Greater Access to Oil to Reduce Dependency on US Market
December 25, 2004—President Chavez said that Venezuela will offer China greater access to Venezuelan resources, such as oil, natural gas, and related products, in an effort to reduce Venezuelan dependency on the U.S. market.
Chavez made the announcement during a state visit to China, which he and various ministers of his are visiting over the Christmas holidays. Chavez said, “Venezuela brings a great energy offer to China because China has turned into the second largest importer of energy in the world.”
Among the offers that Venezuela is making to China is the permission for Chinese companies that produce crude oil to also extract gas that is related to this crude. China has been engaged in joint ventures in Venezuela for many years already. This gas would not be used for export, though, but to supply the energy needs of Venezuelan industries in Guyana, which are mostly mining and metal ore processing.
Venezuela and China will also sign an agreement to continue Orimulsion production in Venezuela. Orimulsion is a product of extra-heavy crude oil, whose production process is patented by Venezuela and which can be used in some Chinese refineries for the production of fuel.
Another important area of cooperation will be to help China to build up a strategic oil reserve, so as to protect China from possible short-term oil shortages. Chavez emphasized that Venezuela is planning on expanding a pipeline through Panama, in order to more easily transport Venezuelan oil to the Pacific Ocean and then to China.
Eight agreements for a “strategic alliance”
On Thursday Chavez and China’s President Hu Jintao met in Beijing’s Great People’s Palace to sign eight documents of cooperation. These included an agreement for China to help with the construction of Venezuela’s railroad system, strengthened cooperation in the energy and mining sectors, the creation of a $40 million credit line for Venezuela’s purchase of agricultural equipment from China, and the construction of a Chinese model farm in Venezuela, among others.
20 proposals for Chinese business
During a meeting with Chinese businesspeople at the Chinese Council of the Chamber for the Promotion of International Commerce, Chavez presented two sets of ten proposals each. The first set involved investment offers in Venezuela’s energy sector and the second set of ten proposals involved a variety of other sectors, such as agriculture, transport, tourism, mining, telecommunications, and military technology.
Chavez said that Venezuela is very interested in supporting China’s economic development because of its interest in supporting worldwide balance, “because this is what is needed in the world in order to break with unilateralism.”
Venezuela to acquire Chinese telecommunications satellite
Venezuela’s Minister of Communication and Information, Andrés Izarra, announced from Beijing that Venezuela is looking into acquiring a Chinese telecommunications satellite, so that Venezuela would be able to guarantee its sovereignty in this area.
Izarra said, “Venezuela provided a document with the technical requirements for the acquisition of a Chinese telecommunications satellite,” after coming out of a meeting with the president of China’s national aerospace administration.
Izarra also said that he had meetings with the vice-minister of China’s national radio, TV, and cinema administration, in order to discuss possibilities for training Venezuelans to use broadcast media technology.