SA, Venezuela sign energy deal
Michael Appel
3 September 2008
South Africa and Venezuela signed a number of agreements and memorandums of understanding on energy, upstream oil and gas, and offshore oilfields during the first state visit by Venezuelan President Hugo Chavez on Tuesday.
Among other things, the agreements are expected to provide South African state oil company PetroSA with crude oil from Venezuela's state-owned petroleum company at a preferential rate.
The agreements also seek to pursue commercial opportunities around gas-to-liquid technology, an area where PetroSA is a world leader with enormous capacity.
Venezuela has one of the largest oil reserves in the world and is the world's fifth-largest exporter, and developing commercial relations in this sector could provide alternative sources of energy to South Africa.
South Africa is the largest oil consumer in southern Africa, accounting for more than 68% of total consumption by the 14-nation Southern African Development Community, and the second-largest oil consumer in Africa after Egypt.
Speaking to journalists in Pretoria on Tuesday, Chavez said he would like the relationship between South Africa and Venezuela to move onto a strategic level.
"The world is faced by a financial, food, energy, ecological and moral crisis … and it is therefore of the utmost importance to unite the people of the South," he said.
"I would like to stress that the energy and oil agreements that were signed should all be implemented as soon as possible," Chavez added. "PetroSA should immediately go to Venezuela to work with us to exploit the vast opportunities in oil."
Speaking after his meeting with Chavez, President Thabo Mbeki said the agreements showed that the relationship between South Africa and Venezuela had indeed "taken on a strategic character ... The relationship is real, actual and practical. We spoke of a strategic partnership, which means we will learn from each other."
"The agreements we have signed provide for the further detailing and discussion to expand co-operation in the field of oil and energy," Mbeki said. "One main purpose of the agreements is to cut out the intermediary. So you have direct state-to-state relations in the area.
"This will remove certain costs reducing the price somewhat."
Chavez described Venezuela as a "mix of Africa and America … white, black, Indian, and [therefore] we greet you from the bottom of our hearts as we are in Mother Africa.
"The struggle for liberation in Latin America has always been inspired by the struggle for liberation in South Africa and Africa."
Source: BuaNews
