#4 The article also said that China might be re-selling Venezuelan crude. Is China not North Korea main oil supplier?
China is not only interested in oil exploration. They are also looking into telecommunications, farming, construction and "other things".
[LatelineNews: 2005-1-29] CARACAS, Venezuela - China signed energy accords with Venezuela on Saturday that aim to make the Asian economic giant a major player in the oil and gas industry of the world's No. 5 crude exporter.
The 19 cooperation agreements signed in Caracas during a visit by Chinese Vice President Zeng Qinghong included plans for multimillion-dollar Chinese investments in Venezuelan oil and gas fields. They also foresaw Chinese financing and technical support for telecommunications, mining and farming.
Venezuela ships more than half its daily oil output to the United States in a decades-old energy relationship.
But left-wing Venezuelan President Hugo Chavez, a fierce critic of Washington, has made clear he wants to diversify his country's overseas energy ties to reduce its economic dependence on the American market.
"China is a world power. ... She doesn't come here with imperialist airs, she comes here like a sister. God bless China," he told Zeng at the signing ceremony.
Despite Chavez's anti-U.S. rhetoric, many experts say the United States remains Venezuela's most natural energy market because of its proximity and its refineries geared to process Venezuelan crude.
Accumulated American investment in Venezuela's energy sector is in the billions of dollars.
MAJOR OPPORTUNITIES
Saturday's agreements, which cemented projects announced by Chavez during a December visit to China, opened up major oil and gas development opportunities in Venezuela for the China National Petroleum Corporation (CNPC).
One foresees a joint venture with local state oil firm PDVSA in Venezuela's Orinoco oil belt to convert extra-heavy crude into upgraded, lighter oil for export. The CNPC would join major U.S. and European oil companies that already have similar operations.
Under another accord, the Chinese company will exploit more than a dozen oil and gas wells at Zumano in eastern Venezuela, Venezuelan Oil Minister Rafael Ramirez said.
He told Reuters the Zumano field had estimated reserves of 400 million barrels of oil that could reach 1 billion barrels with further exploration.
CNPC already operates two Venezuelan oil fields and will now be able to extract natural gas from them as well.
Another agreement sees China participating in the building of a $250 million telecommunications network in Venezuela, Venezuelan Infrastructure Minister Ramon Carrizales said.
China would also provide credits for housing and for machinery and technical support for Venezuelan farms.
A Venezuelan proposal to build and launch a $200 million telecommunications satellite in China was also being studied.
"Relations between China and Venezuela now stretch from the sub-soil, where we have our oil and gas, to the stratosphere, where we are going to place our satellite," Chavez said.
Since he was first elected in 1998, the Venezuelan leader has made a point of increasing political and trade ties with China and has increased his verbal attacks against the United States, which he accuses of trying to topple him. Reuters http://latelinenews.com/ll/english/1347004.shtml
|
Oil futures traders in London and New York have come up with a catchy term to describe an additional source of uncertainty when it comes to judging potential volatility in supplies: the Chävez premium. There is as yet no established formula that serves to precisely calculate how many dollars should be added to the price of a barrel of oil because of Venezuela's President Hugo Chävez, from whom the term derives. However, one thing is clear: political uncertainty stemming from Mr Chävez and his policies is becoming not only a factor in the oil markets, but it also has implications for Venezuela's sovereign bond holders and for oil multinationals.