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Agenda 2000
Visit to Venezuela by a select delegation 29 October - 3 November 2000 "To continue and intensify the energy dialogue between the European Union and Venezuela as a structured part of the necessary energy dialogue at global level ". It was with this in mind that the Venezuelan authorities invited Dr. Rolf Linkohr, a member of the European Parliament, Vice-President of the delegation for Latin America and President of the European Energy Foundation, to visit Venezuela’s energy sector, accompanied by a delegation representing the European Parliament, the Council Presidency, the European Commission and the Foundation. The members of the delegation were: for the Parliament, in addition to Dr. Linkohr (PSE-DE), Neena Gill (PSE-UK) and Alejo Vidal Quadras (EPP-SP), Vice-President of the Parliament; for the Council, at that time under the French Presidency, Bruno Gremillot, Head of the International Service in the Directorate General for Energy and Raw Materials; for the Commission, Dominique Ristori, Director of General Affairs at the Directorate General for Energy and Transport; for the Foundation, Jean-Claude Charrault, its General Manager. The Venezuelan Ambassador to Bruxelles, Luis Xavier Grisanti, whose active contribution should be emphasised, was involved in preparations for the visit and was present for its duration. The visit included trips to oil and gas production sites and hydro-electric plants, as well as discussions on a range of technical and economic aspects. At the political level, the salient points of the visit were : (1) The opening reception hosted by Dr. Alvaro Silva Calderón, first Deputy Minister for Energy and Mining. (2)A meeting with the National Assembly’s Standing Committee on Energy and Mining. (3) A meeting with Dr. José Vicente Rangel, Minister of Foreign Relations. (4) A joint press conference given by Dr. Ali Rodriguez Araque, Minister of Energy and Mining and Dr. Rolf Linkohr. At the time, Dr. Ali Rodriguez was the President in office of the Organisation of Petroleum Exporting Countries (OPEC). Finally, it should be noted that on the day of its arrival (29 October) and on the eve of its departure (2 November), the delegation held in-depth talks with the Ambassadors of the Member States. These discussions were organised by the European Union’s Delegation in Caracas, which made a valuable contribution to the visit as a whole. On 2 November, the delegation had talks with a number of representatives of European companies operating in Venezuela. * In substance, the following key points should be noted. Venezuela has some of the largest oil reserves in the world if oil shale is taken into account. Moreover, these heavy oils are now beginning to be developed as a result of dilution technologies.
Rapid progress is being made as regards the recovery and exploitation of the gas found with the oil, as well as with research into independent gas fields. The level of oil prices shapes energy policy. The OPEC countries agree that prices should be restored to a reasonable level in the range between 22 and 28 $ /bbl. Once the oil price returns to this level, OPEC should no longer carry out any drastic re-adjustments to output. The modernisation of Venezuelan laws on oil, gas and electricity, clarifying relations between the State and private companies, should attract foreign investors. This modernisation programme is in line with the changes in the European Union’s own legislative system.
Venezuela feels that it has a duty to look after the interests of the smaller countries of Latin America which have neither oil nor financial resources. Oil price levels are a crucial factor in the economic development of Venezuela whose long-term objective is to reduce its economy’s dependence on oil. The country is also seeking to integrate the oil sector’s « downstream » activities (i.e. the refining sector) in order to have an oil industry in the full meaning of the term. Finally, it wishes to make both private and public investment profitable. A new tax policy has been introduced to help achieve this objective. Although 93% of the population has access to the electricity grid, there are still 10,000 villages which are not connected because of their remoteness from the centres of production. Now that the process of decentralisation and regionalisation, which includes facilitating access to energy – especially electricity – is under way, the local authorities will be involved in choosing the most appropriate technologies, including the use of renewables, for those cases where local conditions make traditional forms of energy unsuitable. It is thus clear that there is much scope for technological and industrial co-operation between Venezuela and the European Union and Venezuela is very keen to pursue efforts in this area. *
* * More generally, Venezuela’s long-term policy is based on an open and frank dialogue aimed at securing a stable international oil market ; Venezuela wishes to exercise a moderating influence and wants to tackle the real issues, although it acknowledges that psychological factors (the situation in the Middle East) are very important and that the market is volatile. With its affirmed “Europeanist” vocation, Venezuela seeks to create a special relationship with Europe within a multipolar world and to be the driving force behind a movement to bring the countries of the Caribbean and Latin America closer to Europe. In any case, Venezuela shares the European Union’s objective of establishing an assured and sustainable dialogue between oil producers and consumers, which implies, inter alia, transparency in price formation mechanisms. In this context, it will also mean examining in detail the question of oil taxation, which is a problem that relates to domestic sovereignty but which has international repercussions. In this respect, the delegation affirmed that the European Union’s policy would be not to modulate the tax burden on oil products as a function of oil price fluctuations. The influence of other factors such as intermediaries should also be taken into account. * In short, Venezuela’s policy is aimed at strengthening OPEC whilst promoting a frank dialogue between oil producers and consumers. As part of this exercise, Venezuela views the European Union as a special partner with whom it hopes to establish greater technological and industrial co-operation.
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