By Lesroy W. Williams

Observer Reporter

(Basseterre, St. Kitts)- Oil can really attract a crowd.

Dignitaries, ambassadors, government officials and invited guests including the Hon. Assim Martin, Minister of Public Works, Utilities, Transport and Post, the Hon. Denzil Douglas, Prime Minister of St.Kitts and Nevis and His Excellency Cruz Bello, Ambassador of Venezuela, witnessed the official opening of the office of Petroleo de Venezuela (PDV) St.Kitts-Nevis Ltd, located at the corner of Church and Central Street, on September 10.

Mr. Levi Bradshaw, chairperson of the ceremony, said that the opening of PDV St. Kitts-Nevis Ltd is the beginning of a new era in the management and delivery of energy and its associated services to citizens and residents of the twin-island Federation.

The decision to form a joint venture company by the Government of St. Kitts and Nevis and the Republic of Venezuela is one of the outcomes of the Petro Caribe agreement signed by 19 countries in the Caribbean and Latin America, he said.

PDV St. Kitts and Nevis limited is a transnational company constituted between the government of St. Kitts and Nevis and Venezuela. It will be the body in charge of managing the affairs relating to the PetroCaribe Agreement.

St. Kitts and Nevis signed the PetroCaribe agreement in 2005.

PetroCaribe S. A. is a Caribbean oil alliance with Venezuela to purchase oil on conditions of preferential payment. The alliance was launched in June 2005. The payment system allows for a few nations to buy oil on market value, but only a certain amount is needed up front; the remainder can be paid through a 25 year financing agreement with one percent interest. The deal allows for the Caribbean nations to purchase up to 185,000 barrels of oil per day on these terms. In addition it allows for nations to pay part of the cost with other products provided to Venezuela, such as bananas, rice, and sugar.

PetroCaribe will only deal with a state-controlled entity, meaning that the PetroCaribe agreement is based on eliminating all intermediaries.”Only state-run entities, not private businesses, can deal with PetroCaribe. The Venezuelan state oil company rejects business dealings with any private oil company in these countries, believing these private companies to be corrupt and criminal in their operations,” according to Wikipedia.

The Hon. Earl Assim Martin said that when the government signed the PetroCaribe agreement in 2005 there was a lot of suspicion about the deal but that he can now say that Venezuela has lived up to their agreement with PetroCaribe.

Mr. Martin said that he was extremely pleased to be associated with the setting up of PDV St.Kitts and Nevis Ltd. He said that since signing the PetroCaribe agreement, the Federation has received 8000 barrels of Bitumen from Venezuela. Bitumen is the ingredient needed in the production of asphalt for the resurfacing of roads.

Mr. Alexander Nikolic of Venezuela is the General Manager of the Joint Venture Corporation (JVC) which includes PDV St. Kitts and Nevis Limited.

Mr. Nikolic said that 100 percent of the energy in St. Kitts is generated with diesel obtained through the PetroCaribe agreement.

Mr. Nikolic also said that one of the generators at the power plant that was purchased through the Antigua and Barbuda Investment Bank in Antigua (ABIB) will be taken over by the JVC. In other words, the loan will be transferred from the ABIB to the JVC.

According to Mr. Nikolic, when this is done, St. Kitts and Nevis stands to save US$500,000 per year in a period of 7 years. This savings would be used directly in other needs and social projects, he said.