Japan signs 15-year oil deal with Venezuela
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| Published on Saturday, February 24, 2007 |
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TOKYO, Japan (AFP): Japan on Friday signed a 15-year, 3.5 billion-dollar oil deal with Venezuela in a bid to ease the Asian power's dependence on imports from the turbulent Middle East, companies said.
The state-run Japan Bank for International Cooperation has backed the deal, which marks the country's biggest entry into the South American energy sector.
Japan's Marubeni Corp. and Mitsui and Co. signed the deal with Petroleos de Venezuela S.A (PDVSA), which is fully owned by leftist President Hugo Chavez's government.
The 15-year loan will provide funding for the Venezuelan company to develop crude oil reserves and petroleum products for which Japan would have preferential access, the Japanese trading houses said in statements.
Mitsui said the deal would help in "diversifying Japan's energy supply sources and creating and expanding business opportunities for Japanese companies in the oil and gas sector in Venezuela."
Japan is almost entirely dependent on Middle Eastern oil, whose price has fluctuated wildly in recent years due to the region's volatile politics.
Despite being a close US ally, Japan in 2004 signed a two billion-dollar deal to develop Iran's largest onshore oil field. But last year Japan finally slashed most of its stake in the project as the Islamic republic was set to come under sanctions for its nuclear development.
PDVSA is a pivotal player in Chavez's political ambitions. He has used Venezuela's oil company to subsidise fuel shipments to friendly nations and to poor communities.
Despite Chavez's tense relations with Washington, the United States is the main importer of Venezuelan oil and Caracas has said it has no intentions of stopping shipments for political reasons.
Venezuela has the world's sixth largest proven oil reserves. It has an output capacity of three million barrels a day, but the figure is expected to rise in the coming years due to development.
The Nikkei Shimbun, quoting unnamed sources, said that PDVSA's shipments to Japan would start as early as mid-2007 and amount to some 20,000 barrels a day, close to one percent of Japan's daily imports. | | | | Reads : 141 | | | |
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