Venezuela Promotes Regional
Energy Integration for Developing Nations of Central America and the Caribbean
Venezuela’s Natural
Resource Base: Petroleum
“Venezuela is home to the
Western Hemisphere's largest conventional proven oil reserves at 77.8 billion
barrels, as of January 2003. Substantial extra-heavy oil and bitumen deposits
are not included in this total. In 2002, Venezuela produced an estimated 2.9
million barrels per day (bbl/d), down almost 200,000 bbl/d from 2001 annual
production figures. Of this 2.9 million bbl/d, about 453,000 bbl/d were
consumed domestically, while the remaining 2.46 million bbl/d were exported.
About 1.4 million bbl/d (62% of total exports) were shipped directly to the
United States in 2002 (note: this does not count crude oil sent to the
Caribbean, refined there, and then re-exported to the United States).”
Source, United States
Department of Energy, Energy Information Administration
http://www.eia.doe.gov/emeu/cabs/venez.html
Venezuela is the world’s third largest
oil-exporter, ranking within the top four petroleum exporters to the United
States. According to the World Bank,
petroleum accounts for about 80% of Venezuela’s total exports, 25% of GDP, and
50% of all fiscal revenues. Venezuela’s “natural resource wealth has bolstered
development progress,” especially in social services like education (88% of the
youth are enrolled in school), and
essential services infrastructure (84% of the population has access to improved
water sources).
Oil production capacity hindered
during an opposition strike in 2002.
Source: Embassy of the Bolivarian Republic
of Venezuela
Venezuela’s Vision of Hemispheric Energy Integration
Regional economic
development and hemispheric energy integration are focal points of Venezuela’s
regional cooperation. Indeed, it has much to share with its neighbors.
According to the United States Department of
Energy’s Energy Information
Administration (EIA), petroleum consumption accounted for almost three
quarters of Central America’s total energy consumption in 2000, and about 92%
of the Caribbean region’s energy consumption in 2001. Because the region is
made up of emergent markets and less developed economies that do not share a
petroleum-rich natural resource base, Venezuela’s regional energy policy is
characterized by the extension of favorable
petroleum export terms throughout the region. The main mechanisms used to
extend these helpful export provisions are the San Jose Petroleum Accord and
Caracas Energy Accord.
The
San Jose Petroleum Accord
In 1980, the San Jose Petroleum
Accord was created to facilitate the supply of petroleum products on favorable
terms to eleven developing nations within the Central American and Caribbean
region. The agreement, jointly administered by Mexico and Venezuela and renewed
annually, provides signatory nations up to 160,000 bbl/d, with 80,000 bbl/d
coming from Mexico, and 80,000 bbl/d from Venezuela. The two nations will finance the purchase of oil for their
neighbors up to 20% of the total invoice.
