Petrocaribe is an example of complementarity, solidarity and respect to each country

Caracas, 17 May. AVN .- On June 29, 2005, the energy cooperation agreement Petrocaribe was born to solve the asymmetries in the access to energy resources by means of a new scheme of favorable, equitable and fair exchange among Caribbean countries.

The initiative proposed by the Bolivarian Government was endorsed by 14 countries: Antigua and Barbuda, Bahamas, Belize, Cuba, Dominica, Granada, Guyana, Jamaica, Dominican Republic, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Suriname and Venezuela.

Haiti and Nicaragua joined on August 2007 during the Third Petrocaribe Summit held in Caracas and, on July 13, 2008, during the Fifth Summit, Guatemala became also a member.

“Petrocaribe is a reality for most of the countries in Central America and the Caribbean. It has brought outstanding results that we can show the world as examples of solidarity, complementarity and respect to each country,” stated the Venezuelan Energy and Oil minister Rafael Ramirez during the Sixth Summit of Petrocaribe”s Council of Ministers held last week, in Caracas.

The Venezuelan state-run oil company Petroleos de Venezuela (PDVSA), through its subsidiary PDVCaribe, sends 200,000 barrels of oil per day (bbl/d) to Petrocaribe, which establishes a long-term payment mechanism with the financing of a portion of the supply depending on the oil prices at the international market.

In current conditions, countries have to pay 50% of the oil supply in 90 days and the other 50% in a 25-years term at a rate of 1% of interest and with two-years grace period.

Regional Energy Security

According to PDVSA”s website, in 2007 Petrocaribe signed an Energy Security Agreement aimed at expanding the refining capacity and build or upgrade energy infrastructures in the region for hydrocarbons consignment, reception, transport, storage and distribution.

In that framework, a series of infrastructure projects have been designed with each member of the Caribbean energy alliance.

Antigua and Barbuda is negotiating to purchase a fuel distribution plant with a capacity of 1.5 MMb; while Dominica built a distribution and Liquefied Gas of Petroleum (LGP) filling plant with a capacity of (39 MBD).

The projects with Cuba are: reactivation of a refinery and the terminal in Cienfuegos (65 MBD) and its expansion to 150 MBD; construction of a refinery in Matanzas (150 MBD); expansion of the refinery Hermanos Diaz to 50 MBD); construction of a regasification plant of Liquefied Natural Gas (LNG) and a petrochemical plant.

Projects with Granada are aimed at the construction of a fuel distribution plant and a LGP plant (41MBD) and a tank (18MB); in Haiti, it was built an electric generation plant of 60 MW and a fuel distribution plant will be constructed. In Jamaica, Petrocaribe is working to expand Kingston”s refinery to 50 MBD.

In Nicaragua, the construction of the Industrial Complex El Supremo Sueño de Bolivar is in progress, including a refinery (150 MBD), a fuel distribution plant (1,080 MBD) and a petrochemical plant. In addition, it is expected the construction of an electric generation plant of 290 MW.

In Dominican Republic, PDVSA purchased 49% of the Refineria Dominicana de Petroleo. In Saint Kitts and Nevis a fuel distribution and LGP filling plant (47MBD) is being constructed and in August 2010, the construction of a tank (5MB) was finished.

Moreover, in Saint Vincent and the Grenadines, it is expected the construction of a fuel distribution plant (34MBD) and a LGP filling plant is functioning since February 2007.

All these infrastructure projects are accompanied by social works ion tourism, education, health, roads, environment, agriculture, food sovereignty, citizen”s security, among other.

According to Rafael Ramirez, over 122 million dollars have been invested to foster the energy development in the region.

“Energy security includes a reliable and direct supply; for such reason we have proposed to have state-run mixed ventures so each country will be able to manage sovereignly its resources without intermediaries, which create so much speculation in the international oil market. We have progressed a lot in that sense in the Caribbean and in the South,” Ramirez pointed out.

Agreements reached

During the Sixth Petrocaribe ministerial Summit, it was agreed that Petrocaribe”s technicians will meet in Venezuela next June to evaluate technology cooperation, projects, compensatory mechanisms and joint activities in the area of oil and natural gas exploration.

Moreover, it was decided that every six months the Council of Ministers of Petrocaribe will hold a meeting and the location will vary among member countries. The first meeting will be in Nicaragua next October.

It was also agreed to improve the compensatory mechanism of energy invoices with good and services from each country, so as to promote fair commerce.

Likewise, it was reaffirmed the necessity of establishing “a sustainable financing system, assuring and optimizing the development of socioproductive and social projects in the region, and the feasibility of mixed ventures,” through a new scheme called Petrocaribe”s Integrated Fund. Member countries will work together to shape said proposal.

The resolution supports the development of regional geothermal potential and the use of renewable energies, energy saving and efficient use of energy.

“Petrocaribe is an effective mechanism to solve our own issues based on cooperation and integration,” Ramirez pointed out.

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