Thursday, September 25, 2008

Chavez says has enough oil for all customers

Venezuela's plans to triple oil shipments to China over the next several years will not mean a cut in supplies to the United States and other countries, President Hugo Chavez said Thursday.

Speaking at the end of a three-day visit to the Chinese capital where he signed deals for increased energy cooperation and to buy military jets, Chavez said Venezuela had enough oil capacity to meet everyone's needs. "Venezuela is one of the few countries whose oil reserves allow them to take up enormous commitments around the world," Chavez told a news conference before flying to Moscow.

Chavez said Venezuela aims to increase oil exports to China to 1 million barrels a day by 2012, up from 330,000 per day now. The two sides also plan to build four oil tankers and three oil refineries in China capable of processing Venezuela's heavy, sulfur-laden crude. "This is not going to affect supplies to any other country," he said, when asked if sales to the United States would fall because of a planned increased in shipments to China. Venezuela regards China as a key link in its strategy of diversifying oil sales away from the U.S., which still buys about half of Venezuela's oil despite years of political tensions.

Other plans for cooperation with China call for building a refinery in Venezuela and launching a joint oil-development project in the crude-rich Orinoco River belt. China also plans to build oil tankers for Venezuela. China is the world's second-biggest oil consumer and importer after the United States and its imports are growing by more than 10 percent a year.

Chavez said Venezuela was expecting to increase its proven oil reserves to 300 billion barrels by next year. Earlier this month, Venezuela's state news agency said the country now has 142.3 billion barrels in proven reserves, following the incorporation of new oil fields in the crude-rich Orinoco River belt.

In Beijing, Chavez met Chinese President Hu Jintao and other officials, although details of their discussions were not immediately available. The two leaders oversaw the signing of 12 cooperation agreements in areas ranging from culture to trade, including energy cooperation. Chavez also confirmed that a Venezuelan-Chinese fund to finance joint development projects between the two countries was doubling in size from US$6 billion to US$12 billion. The fund aims to increase Venezuelan oil exports to China, and build railroads, telecommunications networks and shipyards in the South American country.

Chavez added that Venezuela may send pilots to China for training and confirmed that Venezuela was buying military training jets from China, saying the planes would be delivered next year. He gave no further details but has previously said that Venezuela would buy 24 Chinese-made K-8 flight training and light attack aircraft. Under Chavez, Venezuela has bought 24 Russian Sukhoi fighter jets, 100,000 Kalashnikov assault rifles, 53 attack helicopters and a Chinese radar system. The military acquisitions have raised concerns among U.S. officials, who argue that Venezuela does not need so much military power. But "the planes we are buying (from China) are few and meant only for training our pilots," Chavez said. "I don't think others should criticize us for it."

Venezuela will launch its first satellite from China on Nov. 1, a move Chavez has said would further cement bilateral ties and boost Venezuelan independence. The Chinese-made satellite, to be launched from southwestern Sichuan province, will cover several Latin American nations and will make Venezuela self-sufficient in television, Internet and other communication transmissions, Chavez says.

Chavez's trip to Moscow will be his second to the Russian capital in two months. On Monday, Russia sent a navy squadron to Venezuela for joint maneuvers, an unprecedented deployment of Russian military power to the Western Hemisphere since the Cold War and an obvious snub to Washington.


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