Venezuela signed an agreement with Chinese companies Citic Group and Industrial & Commercial Bank of China Ltd. to negotiate a 4 billion US dollars loan to finance oil and construction projects, President Hugo Chavez said in Caracas.
Citic International Contracting Inc., a unit of China’s state-owned Citic Group, will build 20,000 housing units in Venezuela and start a joint venture with Petroleos de Venezuela SA to operate mature crude fields, Chavez said on state television.
Chavez has boosted oil shipments to China to repay billions of dollars in loans destined to finance infrastructure projects in the country. Venezuela expects to increase oil exports to about 1 million bpd in 3 years from the current 400,000 barrels, Chavez said.
“We have all the oil that China needs for years to come right here,” Chavez said during a meeting with officials from the Chinese companies.
Venezuela’s Oil Ministry said the country had 296.5 billion barrels of crude oil reserves at the end of 2010, according to information published in the country’s Official Gazette.
State oil company PDVSA may work with Citic to pump oil out of mature fields that have current production of about 50,000 barrels a day in Anzoategui state, company vice president Eulogio Del Pino said on state television.
The 4 billion USD loan would be a “first instalment” of financing to build homes in the country, PDVSA said in a statement. Chavez signed agreements with China’s XCMG Construction Machinery Co Ltd on March 14 to import hydraulic trucks to build homes as he seeks to resolve a housing deficit that has ballooned to 2 million units.
Bilateral trade has surged to 8.85 billion US dollars in 2009 from 250.4 million in 2000, according to Venezuela’s Banco de Comercio Exterior, the state-run trade bank.