Newswire: South America

[Brazil] -- Brazil strengthens state control over offshore oil reserves -- Xinhua
Brazil announced on Monday new oil exploration rules to increase state control over its recently discovered offshore oil reserves.

Under the plan, the state-owned oil and gas giant Petrobras will be the sole operator of the new oil reserves. It will also have a minimum 30-percent stake in all future projects in the pre-salt layer fields.

Brazil Tries to Maximize Offshore Oil Bonanza-- Latin America Herald Tribine
Brazilian President Lula revealed the government's plans to make Brazil one of the top 10 oil producers in the world and develop what he believes are the world's 9th largest oil reserves, but his announcement of increased state control and further equity sales shook markets, causing Petrobras to lose $7 billion in value in one day.

Petrobras Loses $7 Billion Value as Lula Seeks Stake -- Bloomberg
Brazilian President Luiz Inacio Lula da Silva’s plans for the development of the country’s offshore oil fields stripped Petroleo Brasileiro SA investors of $7 billion in a day.

The proposal, announced yesterday, may allow the state to boost its stake in the company and ensure most income from oil exploration “stays in the hands of our people,” Lula said at a press conference in Brasilia. Petrobras, as the Rio de Janeiro- based company is known, led the Bovespa stock index to the biggest drop in the Americas yesterday after the announcement.


[Venezuela] -- Chavez Says Venezuela Will Continue Oil Exports to U.S. -- Latin America Herald Tribine
Venezuelan President Hugo Chavez said that his country will continue exporting oil to the United States because it is in the Andean nation’s interest.

Chavez said in a statement published in the Lima daily El Comercio that “many people don’t know” that Venezuelan state oil giant PDVSA, through its Citgo subsidiary, has seven large refineries and more than 10,000 service stations on U.S. soil.

“Venezuela can’t take a decision against ourselves. We send the oil to our refineries and to our distribution systems in the United States,” he said.

Caracas Stock Market Up 3% for the Week -- Up 41% for the Year -- Latin America Herald Tribine
The Caracas Stock Index rose 3.16% for the week to close at 49,507 mostly on the back on the continued rise of Sivensa shares on continued optimism over the buyback of its shares to be considered at its shareholders meeting next week. Sivensa shares rose sharply, closing at Bs. 16.5 for a 37.5% rise.


[Peru] -- Two Wounded in Rebel Attack, Peruvian TV Reports -- Latin American Herald Tribine
At least two soldiers were wounded in an attack apparently mounted by Shining Path guerrillas Monday against a counterinsurgency base in central Peru’s Junin province, Canal N television reported.

The guerrillas opened fire around 3:30 a.m. on the Jose Olaya base in the strife-torn Valley of the Apurimac and Ene rivers, known as the VRAE region, Canal N said.


[Bolivia] -- Morales Named “World Hero of Mother Earth” by UN General Assembly-- Latin America Herald Tribine
The president of the United Nations General Assembly, Rev. Miguel D’Escoto Brockmann, on Saturday declared Bolivian President Evo Morales as “World Hero of Mother Earth” in a ceremony at the presidential palace in this capital.

With a medal and a parchment scroll, the General Assembly of the United Nations Organization named Morales “the maximum exponent and paradigm of love for Mother Earth” in the resolution for his decoration that was read during the ceremony.

Bolivia Cries Foul Over Peru Plans for Drilling in Titicaca -- Latin America Herald Tribine
Bolivian President Evo Morales’ government will present a formal complaint to Peru over its plans to drill for oil in Lake Titicaca without consulting La Paz, state-run news agency ABI reported.

Hydrocarbons Minister Oscar Coca sent Bolivia’s Foreign Ministry a note requesting that a formal complaint be made since the body of water straddles the border between the two nations, ABI said.

“Since Lake Titicaca is a bi-national area, it’s obvious that there can’t be unilateral actions” and therefore the matter requires a diplomatic solution, Coca said.


[Cuba] -- Cuba endeavors to raise farm output amid economic downturn -- Xinhua
Pressured by a global economic crisis and a stern U.S. economic blockade that has lasted nearly half a century, Cuba is actively seeking ways to boost its agricultural production.

The measures include turning over land close to cities to residents to plow, replacing fuel-burning tractors with oxen, redistributing fallow land and raising the prices of state-regulated farm products.

Newswire: South-South / Emerging Market Cooperation

[China - ASEAN] - China to Boost Cooperation With Asean on Investments - Bloomberg

China wants to boost cooperation with members of the Association of Southeast Asian Nations to develop trade and increase investment, said Chinese Commerce Minister Chen Deming.


[ASEAN] - Five Asean Nations May Form Rice-Trade Body, Thai Official Says - Bloomberg

Five Southeast Asian nations may set up a rice-trade association next year to cooperate in stabilizing rice prices, a Thai official said.

Thailand, Vietnam, Cambodia, Laos and Myanmar will also cooperate on other issues related to food security and production, said Chiya Yimvilai, a spokesman at a meeting of Asean economic ministers in Bangkok. The countries would also work together on developing rice products, he said.


[Venezuela - Russia] - PDVSA, Russian Group to Start $30 Billion Oil Venture - Bloomberg

Petroleos de Venezuela SA and a group of Russian oil companies plan to spend $30 billion on a joint venture in Venezuela’s Orinoco region.

The 40-year venture will seek to produce crude in the Junin 6 area and may expand to other Orinoco blocks, Russian Deputy Prime Minister Igor Sechin told reporters in St. Petersburg today after meeting with Venezuelan Vice President Ramon Carrizalez. Russian investors will include OAO Gazprom, OAO Rosneft, OAO Lukoil, TNK-BP and OAO Surgutneftegaz. The venture will be signed “in the coming months,” Sechin said.


[Mexico - Uruguay] - Mexico/Uruguay sign strategic association accord and advance trade - MecroPress

Mexico president Felipe Calderón and Uruguay’s Tabare Vazquez signed on Friday in Montevideo a Strategic Association accord to strengthen political dialogue and bilateral trade relations in the framework of the 2004 free trade agreement.


[Mexico - Colombia - Venezuela - Ecuador] - Mexico offers to mediate between Colombia and Venezuela and Ecuador - MecroPress
Mexican president Felipe Calderón on an official visit to Colombia offered his country’s mediation in the conflict between Bogotá and neighbouring Ecuador and Venezuela.


[Peru - Brazil] - Brazilian President to visit Peru to strengthen strategic alliance - Andina
The next arrival to Lima of Brazilian President Luiz Inacio Lula da Silva will contribute to create a new strategic alliance to face Asian markets when signing several trade agreements, the President of Peru-Brazil Integration Chamber Miguel Vega Alvear.

“The arrival of Brazilian President will strengthen the progress achieved up to now in this Peru-Brazil strategic alliance and it will create a new stage in which both countries can face Asia-Pacific markets,”

Newswire: South-South Cooperation

[China - Venezuela] -- CNPC, Venezuela Plan to Build Two Oil Refineries in China
China National Petroleum Corp. and Venezuela plan to build two oil refineries in China, Jiang Jiemin, the president of the Chinese company, told reporters in Beijing today.


[China - Trinadad & Tobago] -- Alutrint: Chinese labor needed due to lack of local expertise
China's EXIM bank placed as a condition on its consent to provide a US$400mn loan to the Trinidad & Tobago government to build the Alutrint aluminum smelter - in the La Brea region of Trinidad island - that the project hire Chinese contractor CMEC to provide labor and technology for the plant, Alutrint manager of communications and community relations Josieann Richards told BNamericas.


[China - Russia] -- Chinese Envoy to Russia: Oil Pipeline Serves Strategic Goals of Both Sides
The construction of the China-Russia oil pipeline conforms with the strategic goals of China and Russia to diversify the former's energy imports and latter's energy exports, Chinese Ambassador to Russia Liu Guchang has said.


[South Korea - Peru] -- Peru hopes to complete 70% of FTA talks with Korea this week
Peru hopes to complete 70 percent of free trade negotiations with South Korea this week because of the similarities found between the two negotiating teams, allowing them to progress quickly, Peruvian chief negotiator Nathan Nadramija said Monday.

During the first round of FTA Negotiations in Seoul on March 16, both countries successfully concluded four chapters relating to electronic commerce, border services, as well as two other chapters related to institutional issues.


[India - Argentina - Bolivia] -- Jindal Begins Producing Gas in Bolivia for Export to Argentina
India’s Jindal Steel & Power has started producing natural gas in Bolivia that will be exported to Argentina, a company executive told Efe on Monday.

Luis Carlos Kinn, manager of Jindal subsidiary Gas to Liquids Internacional S.A., confirmed the successful completion of the first production test at the well drilled in the El Palmar field, some 50 kilometers (31 miles) from Santa Cruz, the capital of the likenamed eastern province.


[Chile - Bolivia] -- Chile Open to Tunnel Proposal Giving Bolivia Access to Sea
The Chilean government is willing to study the proposal by a group of architects that would provide landlocked Bolivia with access to the sea through a tunnel to an artificial island in the Pacific Ocean.


[Venezuela - Angola] -- Venezuelan Government Bank BANDES To Open Branch in Angola
Jesus Alberto Garcia, Venezuelan ambassador to Angola, stated in an interview with Radio Nacional de Angola that Banco de Desarrollo Económico y Social de Venezuela (BANDES), the state development bank of Venezuela, will open a branch in Angola. He added, “This is one of the main things President Chavez wants to do with Africa.” Branches of BANDES outside of Latin America and the Caribbean include Syria and the Republic of Mali.


[Latin America - Spain] -- Spain Wants Closer Ties with Latin America
Spain’s King Juan Carlos and Prime Minister Jose Luis Rodriguez Zapatero said Monday that the upcoming bicentennials of Latin American independence should be used to promote Spanish and European Union ties to the region.

Weekend Newswire: Venezuela

*** Venezuela is a difficult subject to report on. Unless you dig, finding reporters/ journalists with integrity who strive to present a story that is unbiased, it is extremely difficult to get accurate perspectives on the country.

Therefore, when reading articles from major media I tend to focus on the hard data from reliable sources and perspectives which come in the form of direct quotations of "experts," whom represent different points of view. I then disseminate the entire article and form my own opinion.

Hey that's how I do it, you might have your own system. Regardless, in situations such as this where I am publishing a Newswire post on Venezuela where the posts come mainly from:

1. Bloomberg, a U.S financial news giant that loves capatalism and therefore tends to look down on such things as nationalization of private industry.

2. The Latin America Herald, a publication which does a concise job of reporting on all the major headlines that are worthy (in its opinion) for its fan base of wealthy Miami/Ft. Lautherdale dwelling Latinos.

Ok, here we go. Lets start off with a more feel good story about martial arts in Caracas.



Venezuelans aim to kick crime out
Ask most residents of Caracas what the city's biggest problem is, and the vast majority will say "crime". Official figures show a huge increase in violent crime in the Venezuelan capital over the past decade, reaching a total of 130 murders per 100,000 population last year compared to 63 per 100,000 in 1998.

Little wonder then that demand for self-defence classes is at an all-time high. Some martial arts teachers report a five-fold increase in their attendance levels over the past few years.

"My classes have become noticeably larger in the past months," says Karin Yamur, who teaches taekwondo in different parts of the city.


Venezuela Seizes 60 Oilfield Service Company Assets
Venezuelan President Hugo Chavez seized assets from 60 oilfield services companies including Oklahoma-based Williams Cos., using a law the national assembly passed yesterday.


Chavez’s Oil Seizures May Cause ‘Substantial’ Output Decline
Venezuelan President Hugo Chavez’s seizure of assets at 60 oilfield service companies threatens to reduce the OPEC-member country’s output.

“Petroleos de Venezuela doesn’t have the management and strategic capacity to operate these companies properly,” said Jorge Pinon, a fellow at the Center for Hemispheric Policy at the University of Miami, referring to the state-owned oil company. “You’ll see a substantial drop in oil production.”


Chavez Seizes Farms, Says Land Is People’s Property
Venezuelan President Hugo Chavez said land should be considered the property of the people and ordered the government takeover of a group of farms that he said were being underused.


Arsenal Seized from French Expat in Venezuela
An “arsenal of war” including high-powered rifles, grenades, explosives and a flame-thrower, was seized Friday from the home of a French citizen residing in the Venezuelan capital, authorities said.


Venezuelan Broadcaster Facing Sanctions for Quake Coverage
Conatel, the agency that regulates telecommunications and broadcasting in Venezuela, notified Globovisión television of a suit being filed against it for reporting on this week’s moderate earthquake in the Andean nation before any announcement by officials or state-run media.

Newswire: Latin America - Region

[Venezuela] -- Oil-Services Law to Affect Some Foreign Companies
New nationalization legislation now in the hands of Venezuelan lawmakers will impact the operations of some oil-services companies but will leave out rig firms and large well-service firms.

Oil Minister Rafael Ramirez noted Wednesday that firms such as Williams Co. (WMB), a U.S. firm that operates a high-pressure gas compression facility in Venezuela, could be affected by the new law, but noted that oil rig firms and large service firms such as Schlumberger Ltd. (SLB) and Halliburton Co. (HAL) are not included.


[Bolivia] -- U.N. Team Documents Forced Labor Among Indians in Bolivia
LA PAZ – A mission dispatched by the U.N. Permanent Forum on Indigenous Issues reported Tuesday that it had verified the existence of Indian communities in eastern Bolivia that are being subjected to forced labor.


[Peru] -- Central Bank May Cut Interest Rate to 4% as Domestic Demand Stalls
Peru’s central bank will probably cut its benchmark lending rate for a fourth straight month today as slowing inflation allows policy makers to lower borrowing costs and bolster flagging domestic demand.


[Peru] -- Repsol to Invest $500 Million a Year in Peru, Complete Projects
Repsol YPF chairman and CEO Antonio Brufau said Tuesday that the Spanish energy giant would invest $500 million per year in Peru, completing $6 billion in oil and natural gas projects.

The Spanish oil company has a large stake in the development of the Camisea natural gas field in southeastern Peru and plans to begin exporting fuel to Mexico next year.


[Chile] -- Codelco Increases Reserves by 20 Percent
Chile’s state-owned National Copper Corporation, or Codelco, the world’s largest producer of the red metal, increased its proven and probable reserves by 20 percent in 2008, company sources told Efe on Wednesday.


[Mexico] -- Calderon Deploys Reserves as Swine Flu Depletes Mexico Financial Resources
As the sun sets on Ciudad Juarez, the Mexican border city’s citizens flee to the safety of their homes. The vendors who crowd Avenida Juarez to sell tacos and ice cream during the day pack up their carts and disappear. Hawkers who hand out leaflets for a local mall are gone too -- and the mall itself is a ghost town.

Sino-Venezuelan Cooperation

Good old Hu Jintao and señor Chavez met in Beijing today and agreed to step up their efforts to advance cooperation in energy, agriculture and technology.

The two also agreed to take joint steps to combat the financial crisis. How they hope to achieve such a grand goal, one can not say. All in all it's not much different than all the talk that has been going on about fighting the global financial crisis.

Chinese President Hu Jintao (R) meets with Venezuelan President Hugo Chavez
at the Great Hall of the People in Beijing, capital of China, 4/8/09. (Xinhua)

APEC, the UN, IMF, US-Euro, the "G2," etc. All these multilateral organizations and the major economies of the world seem to be making a lot of pledges these days. If anything I think its a good thing in order to restore confidence around the globe. As for this recent foray of China-Venezuelan Cooperation, it is nothing THAT special.

It indicates Chavez continues to aggressively pursue new export markets for Venezuela's oil. Chavez was in Japan earlier this week where he also succeed in getting Japan to promise over $30 billion in investments for Venezuela's oil and gas industry in exchange for guaranteeing a healthy supply for the island (see this Bloomberg article).

Chavez also thanked China for the successful launch of Venezuela's first telecommunications satellite, which according to Chavez will help the "Bolivarian Nation," (a.k.a. Venezuela) achieve scientific and technological independence (see this CNN article about the launch).

Second, it shows that even in the wake of a financial crisis, developing nations are mutually interested in building their relations for the long-term. This means that they remain optimistic about the long-term picture.

A good thing considering growth in the developing world and rising demand from domestic economies is going play a siginificant role in helping the global ecoonomy emerge from this financial crisis.

Of all the announcements, the most important would have to be Hu Jintao's rhetoric. China has its poker face on and is planning its next couple of moves VERY carefully.

The financial crisis has given it a golden opportunity to assert it self on to the world stage. Personally, I believe leaders in China would have preferred to wait a while longer before being forced onto the world stage as a major decision maker and agent of change.

By forging strong alliances with the other developing countries like Venezuela and more importantly the fellow members of the BRIC block (Brazil, Russia, India and China), Hu Jintao and the rest of China's leaders are slowly building allies to support China in a new global framwork.

Venezuela Launches Joint Venture to Develop Offshore Gas Fields

CARACAS – Venezuelan state energy company PDVSA announced the signing of a multi-billion-dollar joint venture with Portuguese, Argentine, U.S. and Japanese firms to develop massive offshore natural gas fields.

The venture, in which PDVSA will have a majority stake, will design, build and operate two liquefaction plants at the Gran Mariscal de Ayacucho gas industrial complex in the northeastern state of Sucre, as well as pipelines to transport the fuel to those facilities.

Click here to access this full article from the Latin American Herald

Venezuela to pump 12% more oil as project costs rise and credit freezes

The credit crisis is hitting home in Venezuela in South America. Days after Chavez won his beloved struggle to be able to run for re-election plans have been announced by the government that Venezuela pans to boost oil output by at least 12%.

By 2013, Venezuela aims to increase its production capacity to 4.94 million barrels a day. This will require around $4.41 billion usd for drilling, $2.2 billion usd for steam injection to increase production and $6.51 billion for equipment to facilitate converting the region's tar-like oil into a low-sulfur crude oil for export.

Back in October 30, PDVSA opened the bidding for potential partners for ventures in the Orinoco oil belt. Which by the way Chavez never forgets to mention now puts Venezuela up there with Saudi Arabia and Canada in "proven petroleum deposits."



PDVSA is currently offering a 40% stake in a joint venture with the Venezuelan state oil company to develop new projects. According to Bloomberg the contracts can extend up to 40 years.

Venezuelans turn out in the thousands to protest Chavez reelection

Caracas was lined with people this Saturday as thousands of Venezuelans turned out ahead of the February 15th referendum to protest against the potential end to presidential term limits.

Venezuelan society remains polarized down the middle in terms of those who support Chavez and those who oppose him. However, past attempts by Chavez to change the constitution in order for him to be allowed to run for reelection in 2012 and beyond have failed.

Manifestantes participaron en marcha contra la aprobación de la enmienda
constitucional del presidente Hugo Chávez en Caracas, 7 feb 2009.
REUTERS/Carlos Garcia Rawlins (VENEZUELA)

If one thing is certain, Latin Americans have had their share of "leaders for life." Even some ardent Chavistas think it's taking things a bit too far.

This is where it seems the opposition, particularly from the Universities are focusing their campaign, passing out pamphlets of a very interesting quote by Chavez's ideological buddy Simon Bolivar.

"Nothing is as dangerous as letting the same citizen remain in power for a long time."

~ Simon Bolivar-- 19th century leader of Latin America's struggle for independence against Spain


Click here if you can read Spanish for the Reuters story this picture came from
Click here for a article in English about this weekends protests from AP

South-South Cooperation: Venezuela's PDVSA begins drilling in Bolivia's Vibora Field

Petroleos de Venezuela SA (PDVSA), announced today one of its oil rigs began operations in Bolivia. Drilling is reported to have begun in the Vibora field, roughly 170 km north of the city of Santa Cruz.


Not a bad headline for Morales and his supporters who voted "yes" for a new constitution just days ago which allows for Morales to run beyond his term limits and which is partly designed to empower indiginous rights.

South-South Cooperation in focus: Venezuela & Argentina

Argentine President Cristina Fernandez signed 21 agreements on Thursday with the country of Venezuela. The agreements are meant to lay the foundation for future cooperation between the two South American nations in such fields as energy, industry and transportation.

Argentinian President Cristina Fernandez (L) and Venezuelan President Hugo Chavez
attend the signing ceremony in Caracas, the Capital of Venezuela, Jan. 22, 2009.

The two presidents agreed to set up a joint venture between Petroleos de Venezuela (PDVSA) and Argentina's state-operated Enarsa energy company to develop oil fields in Venezuela.

"Our strategic cooperation is increasing," Chavez said when referring to the commercial and diplomatic ties between Venezuela and Argentina.

Click here to read further details from this article, courtesy of Xinhua

Souh-South Cooperation: Ecuador and Chile join forces to explore for gas in Guayaguil Gulf

“The board of Petroecuador has accepted the proposal for a new joint company with ENAP”, said Mines and Petroleum minister Galo Chiriboga in Quito.

The minister added that the new joint company will “boost gas exploration in the gulf of Guayaquil”, to the southwest of Ecuador where primary surveys have indicated the possibility of significant natural gas deposits.

Petroecuador is also involved in a similar undertaking with Venezuela’s PDVSA, with the purpose of searching for gas in an adjacent area in the gulf.

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Click here to access the full story from MercoPress

South South Cooperation in focus: Venezuela and Bolivia: energy joint venture

Petroandina, a joint enterprise formed by the Bolivian and Venezuelan state energy companies, plans to invest $883 million to finance oil and natural gas exploration and production in Bolivia, a top official said.

Energy Minister Carlos Villegas announced the figure Tuesday during a press conference to discuss Petroandina's operating contracts, which the Bolivian Congress is set to vote on shortly.

According to Villegas, Petroandina will invest $242.2 million in the western Andean province of La Paz and another $646.1 million in central and southern Bolivia...................

Click here to access the full article from Rigzone

Chavez to expand Venezuela's oil pact

Venezuelan President Hugo Chavez is flexing the country's petroleum muscle once again, stating he seeks to expand Venezuela's oil pact to poor nations in the Caribbean.

Chavez stated "Nations taking part in Petrocaribe initiative will now be required to pay just 40% of the bill within 90 days - down from the current 50%. The rest can be paid over the next 25 years at a fixed rate of 1% percent as long as oil prices are above US$100 a barrel.

"That could compensate for the horrible curve of the jump in oil prices," Chavez said. He added that 70 percent of payments may be deferred if oil reaches US$150 a barrel.

AP Photo

In this photo released by Miraflores Press Office, Venezuela's President Hugo Chavez speaks during the opening ceremony of the Petrocaribe Summit in Maracaibo, Venezuela, Sunday, July 13, 2008. President Hugo Chavez sought to expand an oil-supply pact that is delivering fuel to 17 nations, calling it a tool against poverty and dismissing opponents' accusations that he is giving away Venezuela's oil wealth.

Sounds really generous to me... Venezuela is unarguably of the wealthier Caribbean nations in the Caribbean, however it does remain a country with many economic problems. Calculating if such a long-term donation is even feasible is difficult to do. So many variables could arise in the next 25 years which could cause the cash flow from its oil accounts receivable ledger simply stop...

New government could come into power who don't honor the repayment. Alternative energy could leap frog and bring the price of oil down substantially. A new government could come into power in Venezuela and re-arrange the terms, leaving small Caribbean contries with little bargaining power against Venezuela: their provider of energy and also regional political and economic power.

No less the gesture as it stands is a nice one, and in reality there is just so much domestic investment that is possible given Venezuela's limited FDI and internal domestic capacities. Oil drills may be in shortage, but so is the industry as a whole since the PDVSA strikes. Given the set backs, PDVSA remains a relatively vibrant operation, turns a profit and even manages to give Chavez some diplomatic barganing chips by making Venezuela into a gracious, oil rich country which cares about its region and the poor of world... unlike the United States, which is a underlying point Chavez hopes to make through such efforts.

Venezuela and Colombia make up and begin discussing Orinoco Oil Projects

Venezuela and Colombia are set to discuss possible joint development projects in the oil rich Orinoco belt when the presidents of both countries meet Friday, the Colombian ambassador to Venezuela,
Fernando Marin, said.

"The Venezuelan government has told us that it's important for them to have Colombian presence in the Orinoco belt. It's something that we're eager to talk about," Marin told Dow Jones Newswires.

........................

Allowing for Colombia's presence in the Orinoco belt would be a surprising gesture by Venezuela, given the recent diplomatic disputes between both countries, which escalated to threats of war in March. Chavez has threatened on several occasions to shut imports from Colombia.

Orinoco Heavy Oil Belt, Venezuela

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Click here access the full article. Provided by Rigzone and Copyright (c) 2008 Dow Jones & company, Inc.

Oil and Gas in focus: PDVSA Q1 profit rises 80% to usd $3.5 billion

PDVSA 1st quarter net profit shot up 80%, to usd $3.5 billion, up from usd $ 1.92 billion in the same quarter of 2007.

Although PDVSA's actual real performance might be difficult to predict due to various news agencies and the respective bias they carry when reporting on anything Venezuelan, PDVSA hard figures suggest some hope that Chavez is re-building Venezuela's delapidated and crumbling oil sector.

I am not down on the ground in Venezuela, but from the different Venezuelan-American's i've met, most claim any news they hear from their family and friends in Venezuela is highly bais depending on the individuals political ideology (pro-Chavez or anti-Chavez).

With this in mind I will include te major figures released by PDVSA today, and reported by Business News Americas (BNAmericas). To access the full article from BNAmericas click here.

-- Net profit: rose 80% ---> usd $3.5 billion from 1.92 bilion in 1Q07
-- Total revenue: rose 52% ---> usd $31.4 billion from 20.7 billion in 1Q07
-- Ebitda: rose 85% ---> usd $ 33.3 billion from 19.7 billion in 1Q07

-- Total costs: rose 38% to usd $24.3 billion from 17.6 billion in 1Q07

-- Revenues dedicated to social spending: up a whopping 376% to usd $2.68 billion from $565 million in 1Q07
-- PDVSA total contribtion to Venezuelan state: rose 112% to usd $7.39 billion from 3.48 billion in 1Q07

-- PDVSA oil production: rose 2% to 3.21 mb/d compared with 3.11 mb/d in 1Q07
-- PDVSA natural gas production: fell by 5% to 6.41Bf3/ d (181mm3/ d) compared with 6.73Bf3/ d in 1Q07

***NOTE *** the International Energy Association estimates Venezuela's production is actually close to 2.5 mb/d. Chavez did fire large numbers of workers in the oil sector whom he felt where not supporting his "Boliviaran Revolution." He also soon came to see them as a potential threat, lush with power and money from working in the oil sector, international connections, etc. He fired them all when he took a tough position during the country wide protests which paralyzed the country for about a year. When it was over, 1000's of PDVSA and other workers from the oil the sector found their traditional economic and political power was not able to dictate terms in Venezuela, and as they continued to push they found themselves jobless. 100's of Venezuelan's left to Texas, Miami, the Middle East in search of work in the oil sector abroad.

-- PSVSA recieved an average of usd $87.89/ barrel for exported crude, up 81% from $48.65/ barrel in 1Q07

-- PDVSA exploraton activities: focused on 23 exploration projects with the principle objective of investigation and confirming new reserves.

Peruvian miners begin nation wide strike June 30---- Petrobas to set Orinco Policy---- Brazil and Venezuela hold fourth bilateral meeting

Apologies work and assignments have kept me busy today. Little time or brain power to give you my analysis today of articles I think relevant to discuss. I will however include some pieces which grabbed my attention from the news I read through today.

Peru Mine Workers Begin National Strike for More Pay (Update2) -- Bloomberg LP

By Alex Emery

June 30 (Bloomberg) -- Peruvian mine workers began their third national strike for better pay and benefits in less than 14 months, adding to protests from Mexico to Chile that have disrupted copper supplies and sent prices to records this year.

Miners walked off the job at more than a dozen sites to pressure Congress to pass laws to increase their share of profit and improve pensions, said Luis Castillo, general secretary of the Mining Federation. The group represents about 28,000 mine workers and 70 unions.

``The strike is on across the country and will take several days to solve,'' Castillo said today in an interview from Lima. ``Talks with the congressional committee should get under way tomorrow.''

Strikes have cut copper output in Peru, Chile and Mexico, helping fuel a 28 percent rally in the price of the metal this year. Copper has climbed fivefold in the past five years as rising demand outpaced production, eroding global stockpiles. Peru is the world's largest silver producer and the third-biggest source of copper, zinc and tin.

Also joining the strike were unions representing workers at mines run by Barrick Gold Corp., Southern Copper Corp., Renco Group Inc.'s Doe Run Peru unit, Shougang Corp.'s Hierroperu iron unit, Cia. de Minas Buenaventura SA, Cia. Minera Antamina and Volcan Cia. Minera SA, the Mining Federation said.

``The strike has had a visible impact at the mine,'' Shougang Deputy Manager Raul Vera said in a telephone interview. ``But the strike isn't 100 percent, as some employees have gone to work.''

Legislation

Southern Copper's Ilo smelter and Cuajone mine are operating with subcontracted workers and have not had any ``significant'' output losses, Southern Copper spokesman Alberto Giles said in an e-mail. Toquepala mine workers didn't join the strike, he said.

Doe Run Peru's La Oroya zinc and lead smelter is operating normally, spokesman Victor Belaunde said in by telephone. Employees at Barrick's Alto Chicama and Pierina gold mines also turned up to work ``as normal,'' spokesman Vincent Borg said in a telephone interview.

Antamina spokesman Jose Salazar declined to comment.

Congress will vote this week on a law that seeks to eliminate a ceiling on workers' share of profit, Peru's Labor Minister Mario Pasco said. Workers' bonuses based on profit currently can't exceed 18 times their monthly salary.

``There's no reason for this strike,'' Pasco told reporters in Lima today. ``In a week, more or less, this law will pass.''

Futures

Copper futures for September delivery rose 0.45 cent, or 0.1 percent, to $3.8825 a pound on the Comex division of the New York Mercantile Exchange.

Gold futures for August delivery fell $3, or 0.3 percent, to $928.30 an ounce, while zinc rose $2, or 0.1 percent, to $1,932 a metric ton on the London Metal Exchange.

Peru's Mining Federation held five-day national strikes in November and May of last year. In Chile, contract workers on May 5 called off an almost three-week strike that cost Codelco, the world's biggest producer, an estimated $400 million in lost output and damages.

Mexico's largest mining union is scheduled to vote today on whether to strike to protest the labor secretary's refusal to recognize the re-election of Napoleon Gomez Urrutia as the group's general secretary.

A strike has shut down Grupo Mexico's Cananea copper mine in Mexico since July 30. Grupo Mexico is seeking to buy the workers out and reopen the mine in 2009.

Government Solution

Congress, not the companies, will have to act to solve the dispute in Peru, Buenaventura Chief Financial Officer Carlos Galvez said.

``This is a political issue that has made the federation more visible,'' Galvez said in a telephone interview. ``It's likely there will be more mining operations on strike this time than last year.''

Peruvian lawmakers have been debating legislation since 2006 that would boost profit-sharing and pensions for miners. Peruvian President Alan Garcia last week enacted a law granting more rights to employees of contractors.

To contact the reporter on the story: Alex Emery in Lima at aemery1@bloomberg.net.

Last Updated: June 30, 2008 17:23 EDT

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Petrobras to set Orinoco policy in September - Brazil, Venezuela

Click here to view full article -- BNAmericas

Brazil's federal energy company Petrobras (NYSE: PBR) will define its role in Venezuela's Orinoco heavy crude belt at the September meeting between the two countries, Venezuela's state oil company PDVSA said in a statement.

Brazil's President Luiz Inacio Lula da Silva met his Venezuelan counterpart Hugo Chávez in June in Caracas for the fourth bilateral meeting.

Lula said that both PDVSA and Petrobras would take their time to cement any joint participation.

"These are both large and very powerful oil companies that are currently establishing common denominators that will guarantee a strong participation between the two companies," Lula said.

"The more oil we find, the more powerful we will become," he said in the statement.

Venezuela's PDVSA and China's CNPC to cooperate in the production of 8 new oil rigs -- annually

I am intrigued, as usual, by the fact I am only able to find a few sources in English which have covered the recent development in Sino-Venezuelan cooperation. I suppose this is one of the main reasons I started this site-- to share developments in the works between China and South America, which go largely unnoticed in the West.

As described in a recent article published by BNAmericas, Venezuela's state oil company PDVSA (Petroleos de Venezuela S.A) and China's state oil company CNPC (China National Petroleum), have entered into a joint venture in which the two government owned oil conglomerates will work together in order to produce 8 new oil rigs by years end in Venezuela.

This adds to the two oil rigs delivered by CNPC in November 2007, and three more to come in 2009, bringing the total number of "made in China" oil rigs operating in Venezuela to 13. This will also allow Venezuela's PDVSA, for the first time in the country's history to construct their own oil rigs domestically... without North American or European assistance.

Don't get too excited... This it is not major sign of political or economic unity between the two nations. At least, not on the level Venezuelan state media is reporting it to be. Want proof?

Chinese media has virtually ignored this development, as they usually do with most things concerning Venezuela. China does not want to attract the attention of the US or Europe by dealing too closely with Chavez.

The most recent article published by China's state media, Xinhua, I can find on this subject (in either Chinese or English), is dated May 13, 2008.

Granted my reading ability in Chinese is far from perfect, however searching the words "petrol," and "Venezuela" can usually lead me in the right direction and allow me to find a story pertaining to the topic I am searching for. From what I am able to comprehend in this Chinese article from May, I personally do not feel it is directly related to the deal discussed on June 23, 2008 on BNAmerica's website.

Chavez would like to consider China a strategic ally, both on a political and economic level. As the world's second largest consumer of energy, the match seems to fit... Too bad for Chavez its quite costly to ship Venezuela's heavy, dirty crude oil all the way to China.

Second, Chavez has unrealistically already raised China's economic position and importance for his country right next to the spot the US still occupies. This is hardly feasible to imagine considering Venezuela and China's geographic locations.

Third, Venezuela's trade with China is inconsequential compared with Venezuela's trade with the US.

Fourth, when you compare China's trade with other Latin American nations, Venezuela's trade is insignificant when compared with China's current trade with other nations such as Brazil, Chile or Argentina.

Last, and perhaps Hugo's biggest mistake, is thinking China would be willing to extend it self to a country which is not only in the "back yard" of the US, but also a country which currently is not on good terms with US. Chinese culture, tradition and history have shown the Chinese have a tendency to avoid potential problems that could threaten "peace" or "stability," and a more significant relationship with with Venezuela would therefore be risky.

China has no interest in antagonizing the US, which remains China's major trading partner in the global economy. For now, China's outbound investments will be focused in projects such as the one discussed above. PDVSA will retain a 85% stake in the project, leaving 15% to CNPC. Total investment is projected to be roughly $430 million usd.

Quite small, when you consider for China's new sovereign wealth fund has about $300 billion usd sitting in reserve, waiting to be invested.

**Useful hint for readers **

It is easy to translate English words into Chinese characters without a pinyin input system using this great Chinese-English online dictionary / translator (dict.cn). After you find the characters for the key words you're looking for use "ctrl + f" or "apple key + f (for mac os)," to search for them in a article. Petrol = 汽油 (qi you) , Venezuela = 委内瑞拉 (wei nei rui la).