VENEZUELA: Venezuela agrees to $1.5 billion oil loan with Japan.

Record ID: 343441

  • Title: VENEZUELA: Venezuela agrees to $1.5 billion oil loan with Japan.
  • Date: 29th June 2011
  • Summary: CARACAS, VENEZUELA (JUNE 28, 2011) (REUTERS) GENERAL VIEW OF MEETING JAPANESE OFFICIAL VARIOUS OF JAPANESE OFFICIALS AND VENEZUELAN OFFICIALS SIGNING AGREEMENT VENEZUELA'S ENERGY MINISTER RAFAEL RAMIREZ WALKING TO PODIUM JAPANESE OFFICIALS (SOUNDBITE) (Spanish) VENEZUELAN ENERGY MINISTER RAFAEL RAMIREZ SAYING: "Today, we are signing an agreement for $1.5 billion in
  • Embargoed: 14th July 2011 13:00
  • Keywords:
  • Location: Venezuela, Bolivarian Republic of
  • Country: Venezuela
  • Topics: International Relations,People,Energy
  • Reuters ID: LVA5WUBM5HHGS8WUDCU038B0Q6NX
  • Story Text: Venezuela inks $1.5 billion oil loan with Japan in hopes of injecting cash-strapped PDVSA with more income while deal will help Japan generate more electricity after devastating quake and subsequent nuclear crisis.
    Venezuela formalized a $1.5 billion oil loan with Japan on Tuesday (June 28), to be repaid with crude over 15 years at a rate of Libor plus 3.8 percent.
    Energy Minister Rafael Ramirez said the money would be used to expand capacity at the El Palito and Puerto La Cruz refineries to 280,000 barrels per day and 210,000 bpd respectively.
    Ramirez said the loan to state oil company PDVSA was from the Japan Bank for International Cooperation (JBIC) and eight other financial institutions.
    "Today, we are signing an agreement for $1.5 billion in which the JBIC and eight other banks and two commercial houses are participating with us," Ramirez said.
    PDVSA, the financial motor of Venezuelan President Hugo Chavez's socialist "revolution", urgently needs more income even though global oil prices have been high for months.
    It is contending with falling production plus ambitious investment plans for its vast Orinoco extra heavy crude belt.
    Toyoaki Fujita, regional director for JBIC, said Japan welcomed the opportunity to invest in Venezuela's economy.
    "I would like to take this opportunity to highlight our advance and determination in perceiving positive results through our financial assistance to Japanese companies contributing to Venezuelan economy. Thus we welcome the opportunity to implement these projects," he said.
    The crude supplied would be the low-density Santa Barbara type most suitable for the Asian nation's refineries.
    As well as helping cash-short PDVSA's finances, the deal is also intended to aid Japan's electricity generation after its earthquake and nuclear crisis earlier this year.
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