PDVSA, Petrobras Extend MOU Deadlines Indefinitely

Five memorandums of understanding for several billion-dollar projects between the national oil companies of Brazil and Venezuela have been extended indefinitely, Venezuela's energy and oil ministry announced on Wednesday.

Energy and oil minister and state oil firm PDVSA president, Rafael Ramirez, made the announcement after meeting for several hours with his Brazilian counterpart Silas Rondeau and federal energy company Petrobras (NYSE: PBR) head Sergio Gabrielli.

The MOUs - for joint manufacturing of ethanol, lubricants, sea shipping and others - were signed in February 2005 by Venezuela's President Hugo Chavez and his Brazilian opposite number Luiz Inacio Lula da Silva.

No decision was announced regarding the Mariscal Sucre offshore natural gas project in which Petrobras could play a part, the PDVSA-Petrobras reserve certification process in the Orinoco belt or the construction of the Abreu De Lima refinery in Brazil's Pernambuco state that would be developed as a joint venture. These issues were, however, "reviewed," according to the ministry statement.

As for the proposed US$25bn natural gas pipeline between Venezuela and Argentina, the ministers announced another meeting of the technical teams from both countries to be held in Caracas from June 5-7.

Despite public shows of affection between Lula and Chavez, it is widely believed relations are strained at the best of times. The mood took a turn for the worse on Tuesday, when Brazil's foreign minister Celso Amorin criticized Chavez "interventionism" in the Bolivian energy crisis and his aspirations trade agreement Mercosur be tailored specifically for Venezuela.

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