Venezuela’s Chavez wants to reduce dependence on U.S., promises China more oil and gas

Associated Press

President Hugo Chavez said Dec. 24 that Venezuela will give Beijing greater access to its oil reserves to reduce his country’s dependence on sales to the United States.

Chavez said agreements signed Dec. 23 on the first day of his visit to China will give Chinese oil companies access to 15 oil-producing areas in Venezuela, the world’s fifth-largest petroleum exporter.

China is eager to secure new sources of energy for its economy, which is struggling with power shortages. Venezuela wants to find new customers to reduce reliance on the United States, its No. 1 oil market but also a critic of Chavez’s six-year-old government.

“We have been producing and exporting oil for more than 100 years but they have been years of dependence on the United States,” Chavez said at a meeting of Venezuelan and Chinese entrepreneurs. “Now we are free and we make our resources available to the great country of China.”

Beijing and Caracas also are working on other proposals for closer energy collaboration, the Venezuelan president said.

They cover crude oil, gas, petrochemical industries and increasing Venezuelan oil sales to China, Chavez said during a speech later Dec. 24 at Peking University in the Chinese capital.

Venezuela is offering to sell China 120,000 tons (840,000 barrels) of fuel oil “to generate more electricity because we understand that some areas of China are short of electricity,” he said.

Chavez’s visit to Beijing is part of a campaign to build up trade and political ties with new diplomatic partners that has taken him to Russia, Africa and the Middle East.

On Dec. 24, Chavez met with Premier Wen Jiabao and Vice President Zeng Qinghong. Details weren’t immediately released. The Venezuelan president met earlier with his Chinese counterpart, Hu Jintao.

The Venezuelan leader planned to leave Beijing Dec. 25 to visit the eastern Chinese province of Shandong.

In return for access to oil, China is promising Venezuela technical and economic aid to boost agricultural output and to start a state-run telecommunications company.

Venezuela sells 60 percent of its crude oil exports to the United States.

Chinese oil companies have been invited to explore for oil off Venezuela’s northern coast and to set up oil refineries along its Orinoco River. The deals signed in Beijing give Chinese firms the right to produce gas in Venezuela as well.