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The Oil Cup : Chavez Still Working Hard At Making Friends

by Laurent GUERBY Sat Jul 1st, 2006 at 05:42:47 PM EST

From bloomberg:

Venezuelan President Chavez Urges Africa to Boost Oil Taxes

July 1 (Bloomberg) -- Venezuelan President Hugo Chavez urged African nations to boost taxes on oil producers, saying the world's poorest continent isn't gaining enough benefits from its reserves.

In Africa ``we know there are international companies that do not pay taxes on what they get from petrol, or some pay very little,'' Chavez told leaders attending the annual summit of the African Union in the Gambian capital of Banjul today. ``That is robbery. In Venezuela, they have to pay 30 percent of what they get from petroleum and on income they pay 50 percent. And even with that they are still making a profit.''

Governments in Sub-Saharan Africa will earn more than $200 billion in oil revenue over the next decade, according to a study released June 17 by Catholic Relief Services, a U.S. aid agency, released today. Exploitation of the continent's untapped reserves may encourage conflict and graft, the study found.

Countries with oil reserves have to ensure they aren't exploited, and use the money for development, Chavez said.

``Nature has given Venezuela one of the greatest reserves of oil in the world, and we are tired of this oil going to feed Dracula,'' he said. ``Oil is a powerful instrument for social development, for education, employment, for agriculture, for the life of our people. Petroleum, which was used to colonize us, we are now going to use it to set ourselves free.''

Nigeria and Angola are sub-Saharan Africa's two largest oil producers.

Chavez called for greater cooperation between South American and African oil producers, and said a co-operation agreement similar to that between state oil companies in Venezuela, Argentina, and Brazil may work on the continent.

``We should create a commission so that we can see how we can create a coordinating opportunities for studies and for putting in place practical petroleum projects,'' he said.

Venezuela is South America's largest oil producer with daily output of about 2.6 million barrels a day. Chavez has this year raised fees and taxes paid by foreign companies that pump oil in the country and taken more control over energy joint ventures.


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