Venezuela to set up joint funds with Libya and Syria

Oct 26, 2010 12:00 AM

Venezuelan President Hugo Chavez said his government is creating a $ 1 bn joint fund with Libya to pay for projects that the two countries will pursue together. Chavez announced the investment fund along with a similar $ 100 mm joint fund with Syria as he reviewed the results of his latest seven-nation tour in a marathon speech. He noted that pending projects with Syria range from helping build an oil refinery to setting up a plant for processing olive oil, both in the Middle Eastern country.

Chavez rebuffed criticism by political opponents who argue he is pursuing wasteful giveaways and misguided projects among the 69 accords signed during his trip in areas from oil to nuclear energy. "No one can say we're giving anything away, not a single drop of oil. They're legitimate, transparent and clear agreements that benefit all of us," Chavez said.

He praised a deal for Russia to help build a nuclear reactor in the South American country, saying Venezuela -- which relies mostly on hydroelectric power for electricity -- needs new energy sources. It remains unclear how much Chavez intends to spend on the reactor, or how soon it could be built. The top buyer of Venezuelan oil is still the United States, but Chavez has said his country has increased oil shipments to China to about 500,000 bpd and aims to double that in the coming years.

During his speech, Chavez said the Houston-based oil company Citgo Petroleum, which is owned by Venezuela, is "bad business" for his government because it doesn't deliver enough dividends. He questioned how much the company would fetch if it were sold along with its refineries and thousands of US service stations. "Imagine if you sell eight refineries," Chavez said. "Citgo shouldn't cost any less than $ 10 bn." Chavez has for years been seeking to nudge Venezuela's oil market away from its heavy reliance on the US while extending preferential supply agreements to allies.

The Venezuelan president also ordered the expropriation of US-based glass maker Owens-Illinois which operates in western Trujillo state. The leader criticized the company's practices in the country, saying it had been "taking away the money of Venezuelans" and exploiting local people.

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