China, Venezuela agree to build refinery
Xamar Radio
China and Venezuela have agreed to build a refinery in China to process Venezuelan oil, signalling increasing ties between them.

In a ceremony late on Friday, Venezuelan state oil company PDVSA and the largest Chinese oil and gas company PetroChina agreed to build a 400,000 barrel per day refinery in China's Guandong province.

"Fifteen years ago people said it was impossible to take Venezuelan oil to China because it was too far and the costs made it impossible," Chavez, flanked by Chinese Vice Premier Hui Liangyu, said in a televised address on Saturday.

China's deep pockets and its need to ensure future energy supplies, along with Chavez's desire to diversify Venezuela's trade away from the United States, have brought Caracas and Beijing together.

China this year lent USD 4b to Venezuela, which the South American country will repay in fuel, to create an investment fund for development projects such as improvement of rural roads and expansion of fishing.

Chavez has offered unconditional political support to China, describing widespread protests in Tibet as Washington-backed efforts to harm the Beijing Olympics.