Colombia formally requested to join the regional multilateral development bank known as the Bank of the South. President Alvaro Uribe made the announcement on Friday during the inauguration of a gas pipeline which links Guajira in northern Colombia with Venezuela's Lake Maracaibo area.
"The decision is not a rejection to the World Bank or the Inter-American Development Bank, but a sign of solidarity and fraternity towards the South American community, whom we will not let down," said Uribe, referring to two existing multilateral lenders. Colombian President Alvaro Uribe and two of his South American counterparts Venezuela's Hugo Chavez and Ecuador's Rafael Correa participated in the ceremony by turning on the 224 kilometer long pipeline valves in Colombia's Guajira region. Government owned oil company Ecopetrol SA and its partner, Chevron Corporation began pumping 50 million cubic feet of natural gas a day from the Ballena field in the northern tip of Colombia in La Guajira province to Maraicabo, through the new pipeline. Ecopetrol and Chevron will raise exports to 150 million cubic feet a day in 2009 and 2010, and then reduce them to 100 million cubic feet in 2011. Officials said that from 2011, when Colombian gas deposits in the area supposedly will be exhausted, gas will begin to be pumped in the other direction, from Venezuela. Venezuela's government owned oil company Petroleos de Venezuela SA, PdVSA, will use the gas by injecting in its oil reservoirs to increase pressure and boost production. Venezuela also uses natural gas in its petrochemicals industry. The country needs to import natural gas despite its own huge reserves because it currently lacks infrastructure and sufficient investment in natural gas output. The Venezuelan company built and will operate and maintain the pipeline. PdVSA spent 467 million US dollars to lay down the pipeline, Venezuelan oil Minister Rafael Ramirez said. Colombia, Venezuela and Panama are planning to expand the pipeline toward Central America. "Our technicians are working together with Venezuela and Panama to build a trans-Caribbean gas pipeline so that when we get the Venezuelan gas in Ballena in 2012 we could ship it to Panama and the rest of Central America" said Colombian Mines and Energy Minister Hernan Martinez. Colombia is also planning to expand its gas network south to Ecuador to ship gas from Venezuela or from new reserves that may be discovered in Colombia, Uribe said. The Bank of the South, which will be officially created on November 3 in Caracas, is the brainchild of Venezuelan President Hugo Chavez and is being promoted as an alternative to the World Bank, the IDB and the International Monetary Fund, which he blames for perpetuating poverty and contributing the inflation in Latin America. Chavez has touted the bank as a counterweight to U.S. influence and a way for the region to chart its own economic course. All South American countries with the exception of Peru, Colombia and Guyana are not members of the bank. However President Uribe's announcement in spite of the fact the president of the IDB is a Colombian, Luis Alberto Moreno can be linked to the current battle in the US Congress to have trade agreements between the US and Peru, Panama and Colombia approved. The Bush administration is lobbying strongly not only on commercial grounds but appealing to regional strategic arguments, --with Condoleezza Rice leading--, such as the significance of countering the influence of President Chavez and his oil-dollars full purse in the region.