June 18 (Bloomberg) -- Petroleos de Venezuela SA, South America's No. 1
oil company, agreed to sell fuel oil for a year to China's largest oil
company PetroChina Oil to help meet surging energy demand.
The contract is worth about $431 million based on yesterday's average
closing price of $39.44 a barrel, according to Bloomberg data.
Caracas-based Petroleos de Venezuela said in a statement today it will
sell a PetroChina a total 30,000 barrels a day of fuel oil. The first
cargo of 1.8 million barrels was shipped yesterday.
Fuel oil is burned to generate power or heat.
Venezuela, the world's fifth-largest oil exporter, has repeatedly said
it wants to diversify its customer base. The South American country
currently sends about 1.5 million barrels of oil a day, or about
two-thirds of its oil exports, to the U.S.
Petroleos de Venezuela President Rafael Ramirez will also visit China
in July to discuss additional energy agreements, the company said.
Ramirez, who postponed the trip earlier this week due to scheduling
problems, is also Venezuela's energy minister.
Demand for energy is growing in China as the economy expands. The
country's economy grew 9.5 percent in 2004, the fastest pace in eight
years.
Ramirez said on June 13 that the two countries were also discussing the
creation of an extra-heavy oil joint venture to take crude from
Venezuela's Orinoco Belt.
