Venezuela and Colombia Agree on Gas Pipeline

Foreign ministers Carolina Barco of Colombia and Ali Rodriguez of Venezuela

Caracas, Venezuela, June 20, 2006—Venezuela and Colombia held an important bi-lateral summit last Thursday in Caracas, in which they finalized agreements for a long-awaited gas pipeline, which will run between the two countries and could eventually provide access to markets in Asia.

Construction on the pipeline is set to begin on July 8th for the 230 kilometer underwater gas pipeline, which will connect Colombian Punta Ballenas in the region of La Guajira, with the city of Maracaibo in the western Venezuelan state of Zulia.

According to Rafael Ramirez, Venezuelan Minister of Energy and Petroleum, Colombia will initially be exporting gas to Venezuela through the pipeline in order cover the great Venezuelan demand, but that Venezuela will be self-sustaining by 2008 and exporting natural gas by 2013.

“In the first instance the gas pipeline will allow us to import for Zulia, 150 million cubic feet of gas daily and afterwards we can export to Colombia and Central America the same amount.”

The Colombia Universal, reported on Friday that Chevron Texaco had announced last week that they had finished drilling three additional wells in La Guajira, which will ensure the existence of enough Colombian gas to fulfill Venezuela’s needs.

Meanwhile, the Bolivarian News Agency reported that the discovery of new Venezuelan natural gas reserves will incrementally multiply the 26 billion cubic meters of natural gas that Venezuela is reported to currently have on the market, and Venezuelan and Colombian authorities hope that the pipeline will eventually be extended to the Colombian coast in order to sell Venezuelan gas to China and other Asian countries.

The pipeline was originally agreed upon in July 2004, but due to reccurring tensions it was not finalized until last week. According to Iván Orellana, director of International Relations of the Venezuelan Ministry of Energy and Petroleum, the construction of the pipeline will take exactly one year, and will cost $280 million, which will be completely financed by the Venezuelan state oil company, PDVSA.

Venezuela is currently also pushing for the controversial Great Southern Gas Pipeline, which would run from Venezuela to Argentina, and would be the largest pipeline in the world. President Chavez sees the Southern Pipeline as central to his plans for the alternative integration of South America.

The Guajira gas pipeline was just one of a number of topics which were discussed and agreed to last Thursday between Venezuela’s Chancellor Alí Rodríguez Araque and Colombia’s Carolina Barco at the Second High Level Bi-national Commission meeting (COBAN).

Rodríguez called the meeting a “total Success” and stated, “We tackled a very full agenda, that included trade exchange, energy aspects, physical integration, the functioning of bilateral mechanisms, aspects related with the environment and in conjunction with other aspects.”

Venezuela and Colombia also evaluated the route of an oil pipeline, which Venezuela is planning to build in conjunction with Ecopetrol and would run between Cabrutas to Tumaco, Colombia, on the Pacifica coast. Venezuela’s oil minister Rafael Ramírez declared that this Project, “is very important for Venezuela because it is our outlet towards the Pacific and the expanding Asian markets.”

Both countries also ratified their commitment to fight against narcotrafficking, contraband, and crime along their 2,219 kilometer shared boarder.

“We ratify that we have a common problem, which we will only overcome through collaboration. The problem of the boarder is complex and that’s why we are working intensely in every aspect of that complexity,” declared Rodriguez.

Venezuela and Colombia agreed to expand a gasoline supply project in the Venezuelan boarder states of Táchira, Apure, and Amazonas, in order to attempt to combat the contraband of fuel in Colombian territory.

Because of Venezuela’s recent exit from the Community of Andean Nations (CAN), the Colombian minister of Foreign Relations announced that a commission of Venezuelans will be visiting Colombia in the upcoming days in order to agree on new bilateral trade rules between the two countries during Venezuela’s five-year long official exit from CAN.