Belarus to establish oil joint venture with Venezuela in 2008

MINSK, April 12 (RIA Novosti) - Belarus intends to establish a joint venture with Venezuela in 2008 to refine and produce oil, the acting chairman of the Belarusian state oil company Belneftekhim said Thursday.

Mikhail Osipenko said at an oil conference in the Belarusian capital Minsk that Belarus plans to sell oil produced in Venezuela in that country and buy Russian energy with the funds received.

Osipenko said Belneftekhim is considering real strategic and practical directions of work in Venezuela.

"During the recent [March] visit of a government delegation to Venezuela, 11 documents on cooperation in the sector were signed," he said.

Osipenko said up to 2 million tons per year (40,274 bbl/d) could be produced there, and in the long term, he said, Belarus plans to reach the 10 million tons per year (201,370 bbl/d) level.

Osipenko also said Belarus's foreign policy will focus in the short term on development of oil fields abroad.

He said it is beneficial for Belarus to buy oil from Russia now, but added that "in case of force majeure circumstances, Belarus should find another supplier."

"It is extremely important for Belarus to diversify its purchases of hydrocarbons," Osipenko said.

Belarusian President Alexander Lukashenko said earlier in April that his country is seeking to diversify its oil supplies to ensure energy security, but will not use it as leverage against Russia.

Earlier this year, the neighbors were embroiled in an energy dispute after Russia doubled the natural gas price to $100 per 1,000 cubic meters and Minsk responded by introducing a transit levy of $45 per metric ton for Russian crude pumped to Europe via Belarus.

Russia then briefly halted supplies to Europe, accusing Belarus of tapping its oil transits.

"We must be ready to take oil and bring it to Belarus even if we have to pay more in emergency situations," Lukashenko said. "We will never bow [to pressure], and the Russians are not stupid to force us to import somebody else's oil."

The Belarusian president, whom Washington dubbed "Europe's last dictator" over a lack of democracy and human rights abuses in the former Soviet republic, said then that in order to ensure future energy security, Belarus is now actively exploring possibilities for energy cooperation with other oil-exporting nations, such as Azerbaijan, Iran and Venezuela.

He said the announcement of plans to jointly develop oil fields in Venezuela was far from being a pure PR move, because despite possible difficulties in transportation, Belarus could sell extracted oil on Latin American markets and use the revenues to buy oil from nearby oil-exporters, including Azerbaijan, Kazakhstan and Iran.