Chavez announces $16b oil deal with China

Venezuelan leader Hugo Chavez has said that China will invest US$16 billion into Venezuela’s oil industry to help boost production and reduce the South American country’s reliance on the US, Bloomberg reported. Chavez told Venezuelan state television that the deal was agreed in Beijing on Tuesday and that he hopes it will be signed in October. The Venezuelan president did not name the Chinese companies involved, but said that the deal with state oil company Petroleos de Venezuela (PDVSA), as well as another joint venture agreed with Russia last week, would enable the country’s Orinoco oil fields to produce 900,000 barrels of crude oil a day. Chavez said that PDVSA will work with Chinese oil companies to build rigs and platforms for the Orinoco projects. Venezuela sent an average of 385,000 tons of fuel oil each month to China in the first half of 2009, up from the previous record of 380,000 tons a month in the first half of 2007.