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Vincentian Premier Surprised at Barbados's Rejection of Venezuelan Oil Deal

Posted on: Wednesday, 21 September 2005, 12:00 CDT

Text of report by Caribbean Media Corporation news agency website on 21 September

New York: St Vincent and the Grenadines' Prime Minister Dr Ralph Gonsalves has expressed surprise at the reasons given by Barbados for rejecting the PetroCaribe oil agreement initiated by Venezuela.

Dr Gonsalves told the Caribbean Media Corporation (CMC) that he had trouble understanding why Barbados turned down the agreement, claiming that it would be saddled with more debt.

"I really don't understand that argument, because 40 per cent of what the oil costs you're getting on credit. The credit is one per cent for 25 years," he said.

The Barbados government has turn down participation in the oil initiative being promoted by Venezuela, with Energy Minister Anthony Wood saying that the island was already receiving petroleum products from Trinidad at discounted rates.

"PetroCaribe will not deliver discounted prices for petroleum products. When we compared the current arrangement Barbados has with Trinidad, we are saying the PetroCaribe agreement offers very little in advancing our interest," Wood said.

A number of Caribbean Community (Caricom) countries earlier this month signed the PetroCaribe initiative during a summit in Jamaica attended by Venezuelan leader Hugo Chavez.

Barbados and Trinidad and Tobago are the only two Caricom states that have not signed the agreement, with Port of Spain saying the initiative could undermine its own economy.

Under the Caracas initiative, PDVSA, Venezuela's state-owned energy company will supply signatories with 185,700 barrels of oil daily.

As part of the agreement, a fund has also been established for social and economic programmes, with Caracas making an initial contribution of 50m US dollars, while additional contributions will flow through savings from direct trade or contributions from the financed portion of oil purchases.

Dr Gonsalves said that the importation of fuel to the tune of 100m US dollars a year would yield 40m US dollars in credit and an investment of 10 or seven per cent of that sum in a bank could realize over 40m US dollars.

"So I don't understand the argument. So that one escapes me. As I understand it "Barbados is in a peculiar situation in which it drills oil, and the crude oil is refined in Trinidad. And that's a substantial component of their own energy needs."

"So they have special reasons, "but that one (concerns over debt) doesn't make any sense to me", he added. [quotation marks as published]

Dr Gonsalves said although Trinidad and Tobago had different considerations with the rest of the region, the oil pact can be fashioned to accommodate it "within the same framework of the principles of PetroCaribe; that is to say, of solidarity, of equity, of fairness and of complementarily [as published]".

Dr Gonsalves also announced that his administration has reached an agreement with an unidentified company to search for oil in Vincentian waters.

He would not elaborate on the accord, saying, "all I will want to tell you is that a search is on. I really don't want to say more about it than I have to because this is a matter that is very, very sensitive".

Source: BBC Monitoring Americas

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