By Alexis R. Milan
Belize has begun to consider her options for petroleum and energy security outside of Petro Caribe, following last week’s first ever Caribbean Energy Security Summit in Washington DC.
Energy Minister, Joy Grant made this surprising comment this week after she returned home from the Washington talks.
Although Venezuela was never specifically mentioned at the summit, PetroCaribe was the “elephant in the room.” Grant said.
At this summit, which the United States held, many Caribbean countries openly expressed their gratitude to Venezuela for her PetroCaribe program of preferential rates.
US Vice President, Joe Biden, who hosted the summit, didn’t respond directly to the support for Venezuela, but he hammered home his basic argument that countries can no longer afford to depend on any one source for all their energy needs.
Biden encouraged Caribbean nations to consider investing in infrastructure to facilitate the importation of natural gas, which the United States produces in abundance.
The United States has developed a technology to compress her natural gas for easy handling and shipment. When the gas reaches its destination, it has to be decompressed for regular use.
Belize is not likely to buy any natural gas from the US anytime soon. Firstly, Belize would need to set up a facility to decompress the natural gas when it arrives. For this reason the proposition of importing natural gas for Belize’s energy needs is in a very early stage of consideration, Grant said.
At the meeting, Vice President Biden indicated that the summit is only the beginning of a US drive to deepen relations with the region. He announced that the US will provide funding through the Overseas Private Investment Cooperation Fund (OPIC) to assist private-public sector investments in energy projects.
Jamaica will receive the first disbursement from this fund in the sum of US $46 million for a renewable energy program with a private US company.
Grant said while Belize is most grateful to Venezuela for participation in their visionary PetroCaribe program, which allows governments to finance several social programs, it is important for Belize to start considering energy options for the future and diversifying the energy mix.
Trinidad and Tobago, one Caribbean nation which produces natural gas, resolved during the summit to start a fund to provide for infrastructure so that Caribbean nations will be able to purchase Trinidad’s natural gas.
Biden supported and encouraged this development, saying Caribbean nations should seriously con-sider buying energy from their neighbor (Trinidad).
Minister Grant said Belize has not considered joining in this program with Trinidad and Tobago because that island’s distance from Belize would not make shipments cost-effective.
In the meantime, Venezuela has vowed to continue her Petro Caribe program at all costs, despite deteriorating economic conditions at home.
Venezuela, which depends on oil for 90 percent of its exports, has been reeling from the lower world price of oil. She has been trying, without success, to persuade Saudi Arabia to restrict her production so that the world price can recover somewhat.
Saudi Arabia, is herself competing with cheaper shale oil coming from the United States, and is reluctant to see the price of oil go up.
Currently the cost of petroleum is approximately $45 per barrel. Experts, including those from the International Monetary Fund, have estimated that Venezuela needs the price of petroleum to go back up to about $115 a barrel in order to meet her financial obligations.
Experts and analysts have viewed the summit as a move by the United States to take advantage of Venezuela’s unstable economic situation and persuade the Caribbean region to re-establish an energy alliance with the United States, essentially breaking Venezuela’s influence on the region.
Experts, including those of the International Monetary Fund (IMF) have predicted that due to worsening economic conditions at home, the PetroCaribe program may need to be modified or even cancelled.
Belize has already stopped receiving ship-ments of premium gasoline from Venezuela causing Puma Energy Belize, the country’s fuel importer, to look elsewhere for its supplies of premium gasoline.