China to get big Venezuelan contract

Venezuelan President Hugo Chavez will travel to China later this month to strengthen energy ties between the two countries, and is expected to sign contracts worth more than $1 billion. Chavez will sign agreements for 18 oil tankers worth $1.3 billion, as well as 24 oil-drilling rigs, Energy and Oil Minister Rafael Ramirez said at a press conference today in Caracas. State oil company Petroleos de Venezuela SA will also form a joint venture with China National Petroleum Corp., the parent of China’s largest oil company, for an oilfield-services company.

The two companies will also sign a final agreement to manage and operate Venezuela’s Zumano oil fields in the eastern part of the country. Zumano has proven reserves of about 400 million barrels of light oil and 4 trillion cubic feet of natural gas. Venezuela is currently selling 150,000 barrels a day of oil to China and this is expected to rise to 200,000 barrels a day by the end of the year.