Venezuela, Argentina form energy alliance; Petrobras balks

Sept. 29, 2004
Venezuela's state-owned Petroleos de Venezuela SA (PDVSA) and Argentina's new state energy company, Enarsa have agreed to form an energy alliance called Petrosur. Brazil's state-owned Petroleo Brasileiro SA (Petrobras), however, is reluctant to join.

Peter Howard Wertheim
OGJ Correspondent

RIO DE JANEIRO, Sept. 29 -- Venezuela and Argentina have agreed to form an energy alliance called Petrosur.

Argentine President Nestor Kirchner and Venezuelan President Hugo Chávez announced the agreement at the end of a meeting of the South American common market, Mercosur.

The agreement is for a strategic alliance between state-owned Petroleos de Venezuela SA (PDVSA) and Argentina's new state energy company, Enarsa.

PDVSA Pres. Ali Rodriguez told the Venezuelan press that Petrosur would be part of his company but would be operated separately to form alliances with other state energy companies in Latin America.

Chávez has long proposed a regional organization of oil and gas producers, originally called Petroamerica (OGJ Online, July 14, 2004).

Among hurdles to development of a Latin American energy alliance is reluctance of Brazil's state-owned Petroleo Brasileiro SA (Petrobras), the continent's second largest energy firm, to join.

Petrobras holds or is seeking interests in privatized production and energy infrastructure in Argentina and Bolivia.