The New Herald Posted on Thu, May. 29, 2003 BY RICHARD BRAND rbrand@herald.com

BACK ONLINE: The El Palito oil refinery in Venezuela is running again, loading tankers with gasoline, jet fuel and kerosene destined for foreign and Venezuelan pumps. The refinery is run by Asdrubal Chavez, a cousing of president Hugo Chavez. KIMBERLY WHITE/BLOOMBERG NEWS

EL PALITO, Venezuela - When President Hugo Chávez put his first-cousin Asdrúbal in charge of the El Palito oil refinery here in December during the height of a national strike, opponents cried nepotism and promised the move would backfire as reports of accidents mounted while a skeleton crew tried to resurrect Venezuela's third-largest refinery.

Four months later, El Palito is back online, loading tankers with gasoline, jet fuel and kerosene destined for foreign and Venezuelan pumps. The quick turnaround, accomplished with only 950 workers at a facility that once employed 2,200, has stunned many oil industry analysts who believed the process would take far longer.

The recovery at El Palito under Chávez has been mirrored across Venezuela's petroleum industry, at refineries, shipping centers and oil wells that are the lifeline of this oil-rich but politically divided nation.

Yet the extent of the recovery is in dispute. Officials at Petróleos de Venezuela, the state-run oil monopoly, say crude output has returned to prestrike levels of 3.2 million barrels per day. Analysts put that figure at closer to 2.6 million, a discrepancy worth billions of dollars a year.

''What is clear is that they have been able to materially increase their production,'' said Bruce Schwartz, an oil industry analyst at Standard & Poor's in New York. ``We were surprised at how fast PDVSA was able to restore production.''

Sitting in his new office overlooking a massive seaside complex of metal pipes, spires and choking clouds of sulfur smoke, Asdrúbal Chávez is triumphant.

``They said we would take six months, a year to recover. We did it in two and a half months.''

El Palito's two piers can accommodate four tankers between them. On a recent Saturday, workers loaded 300,000 barrels of jet fuel onto the Maltese-flagged Trogin, carrying a Russian crew. The load was worth an estimated $7.2 million and the refinery's most valuable shipment since the strike, said El Palito spokesman David Palm. The contents were bound for Canada's eastern coast.

Venezuelan national guard troops provide security over operations at El Palito.

''They said I wasn't qualified to run the refinery,'' Chávez said. ``But that was all a campaign of lies.''

For a president pitted against striking workers seeking a referendum on his rule and a divided military that had attempted to oust him months earlier, placing a trusted cousin at the helm of the El Palito, which provides gasoline to 10 critical states, seemed a smart strategic choice. After all, Asdrúbal, whose uncle is the president's father, had worked as a chemical engineer at El Palito for 21 years.

The two are apparently close. Asdrúbal boasted of playing pick-up baseball games with the president when they were young. Asdrúbal also said the president, who enjoys painting nature scenes on paper -- not canvas -- recently gave him several paintings as a present, and he displays them at home.

''We're chums,'' Asdrúbal said.

Asdrúbal is not the first of the president's relatives to rise to prominence. Older brother Adan Chávez is director of the National Land Institute. Ex-wife Marisabel, before the split, was a delegate to the constituent assembly that rewrote the nation's constitution in 1999. And father Hugo Chávez de los Reyes is the governor of Barinas, the family's home state.

After the national strike that brought Venezuela's oil economy to a grinding halt ended in February after two months, most anti-Chávez oil workers were fired, leaving PDVSA with 22,924 employees compared with 40,133 in prestrike days.

Among those who left were at least 10,949 analysts, 2,024 metal workers, 3,434 technicians, 649 executives and 154 tanker crewmen, said Edith Gómez, the new director of hydrocarbons at the energy ministry.

''There was an excess of personnel at PDVSA,'' Gómez said. ``We are adjusting without them.''

Gómez's plush, wood-paneled office in the penthouse of PDVSA headquarters belonged only months ago to a PDVSA executive who left in the strike, she said. The building's lower floors hold rows of empty offices, desks cleaned out. The ministry and PDVSA headquarters now share the same downtown Caracas address.

The departure of skilled workers and managers may pose safety risks for remaining employees, analysts say. Already, reports of fires, injuries and oil spills -- many denied by PDVSA officials -- have cast a cloud over recovery efforts.

''There have been clearly difficulties restarting PDVSA's refineries in that there have been fires and outages that have occurred,'' Schwartz said. ``It may be in part due to a less skilled workforce as a number of skilled managers were dismissed.''

Many of Venezuela's two million unemployed see opportunity in PDVSA's reduced workforce. El Palito refinery alone has received 25,000 résumés from people seeking employment, though Chávez acknowledges that ''only a few hundred have the skills we are looking for: engineers, human resources, lab technicians.'' Some of those will be hired.

The rest are from men like Alexander Vargas, 30, a welder who says he has been unemployed for 17 months. Since April, Vargas has joined dozens of people who make a daily pilgrimage to the chain-link entrance of El Palito, hoping the gates will swing open and somebody inside will offer him work.

''They need people inside,'' Vargas said, ``so I will continue waiting.''

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Sunday, May 18, 2003 By: David Coleman

Petroleos de Venezuela (PDVSA) output at its 940,000 barrels per day capacity Paraguana refinery stands at 734,000 bpd with the 635,000 bpd Amuay plant processing 477,000 bpd and the 305,000 bpd Cardon plant at 257,000 bpd according to a company press release ... the Cardon and Amuay plants form the Paraguana refinery complex which usually processes at around 780,000 bpd.

Production throughout Venezuela's 1.3 million bpd refining network has been almost completely restored after the end of a 2-month national stoppage which failed to overthrow the reformist government of President Hugo Chavez Frias.

• The Paraguana complex was to have restarted exports of reformulated gasoline (RFG) on Friday with a shipment of 300,000 barrels to the United States.

PDVSA officials had earlier said they would restart RFG exports between May 12-14 with some eight cargoes of 250,000-300,000 barrels a month to the US ... a total of 1 million barrels of RFG is scheduled to be exported this month.

• NOVATEC laboratories are producing the so-called "drug cocktails" being distributed free to patients BY LILLIAM RIERA, —Granma International staff writer—

CUBA is manufacturing the anti-retroviral drugs used in the triple therapy treatment given to HIV/AIDS patients, who receive them completely free of charge.

Each tablet costs more than $3 USD on the world market, bringing the annual cost of this therapy to more than $11,015 USD and thus making it inaccessible to the 42 million people living with the virus.

Melvis Heredia Molina, director of NOVETEC Laboratories — a part of the West Havana Scientific Center — told Granma International that this year the company aims to produce sufficient quantities of the drugs for 1,500 patients.

She explained that to date, Cuba only has five anti-retrovirals registered (Zidovudine, Didanosina, Lamivudina, Estavudina and Indinavir), adding that "we are working together with the Center for the Research and Development of Medicines (CIDEM) so that this figure reaches 13." A combination of three drugs is used to fabricate the anti-AIDS "cocktail" treatment.

The island has the lowest number of AIDS patients in Latin America — 0.05% of 15-49 year olds, informed Cuban Health Minister Damodar Peña at a recent forum on the subject in Havana.

The anti-retrovirals are a best seller for NOVATEC Laboratories; other tablets for human consumption produced in the laboratories include anti-ulcer drugs such as Omeprazol (the world’s most popular medication in 2002), antibiotics, anti-inflammatories, antihipertensives, analgesics, antacids, fever reducers and nutritional supplements, all destined for the country’s network of hospitals and pharmacies.

EXPORTS OF MORE THAN $1 MILLION USD IN 2002

The pharmaceutical company also manufactures drugs for export. Heredia pointed out that in 2002, for example, "over $1 million USD worth of anti-retrovirals" were sold. Heber Biotec, the company that markets products from the Genetic Engineering and Biotechnology Center, likewise distributes abroad.

Medication used in the combination therapy for the treatment of AIDS plus others combating opportunistic infections "are already registered in Paraguay and Venezuela," whilst registration procedures are underway in Mexico, Brazil, Colombia, Viet Nam and Guinea."

Nevertheless, NOVATEC is not resting on its laurels. The professionalism of its 367 members of staff — 14% of whom are advanced level technicians and another 34% with intermediate training — guarantees a thorough research program to develop new products such as Itraconaz (antifungal), Azitromocina (antibiotic), Ribavirina (antiviral), Enalapril (antihypertensive), Sumatriptán (antimigraine) and Vimang (anti-inflammatory).

Lorgia Aguiar Gómez-Napier, deputy director of technical production, told us that the company emerged in the 1990s, in the midst of the years known as the special period; it was initiated as a result of the disappearance of the East European socialist bloc and the intensification of the U.S. blockade. "Civil construction and equipment installation began in 1994, but it wasn’t until six years later that production began," she explained.

Although it is not yet working at full capacity, Aguiar highlighted how "600-700 million units" of tablets and hard capsules were produced in 2002; this year’s plan "is to reach 900 units."

Granma International was able to verify that the center uses the most up-to-date equipment, conceived and designed in line with high-production practice guidelines. The company has purchased pharmaceutical equipment from the world’s leading German manufacturers — Glatt, Uhlman, Bosch, Killian and Alexander Werk.

During our tour of the center, we were shown the strict protection precautions developed in the microbiology lab "where air, water, personnel... everything to do with our work, is checked," assured the director.

Sergio Ibáñez, principal specialist in the chemo-physics laboratory, took us through that area explaining that it was the place where "analysis takes place, beginning with the raw and imported materials used in making the drugs, up to the finished product."

Together with head of shift Robert Casanova, we visited the production plant and were able to evidence in situ the new type of production lines designed to allow the product to be conveyed through the different processing phases thanks to gravity.

Without being able to hide a certain pride, the director spoke to us about the "tremendous impact" the company made at the ExpoBrazil Fair in two of the South American giant’s states in April, where "many people were surprised when they discovered the volume of medicines Cuba is producing, including the anti-retrovirals."

Pravda

The Foreign Ministers of Russia and Venezuela, Igor Ivanov and Roy Chaderton Matos, will discuss the situation on the world energy market, official Foreign Ministry spokesman Alexander Yakovenko told RIA Novosti.

Russia and Venezuela, he said, are among the biggest producers and exporters of oil in the world. "Therefore both states are interested in maintaining stability on the energy market," Yakovenko said.

"We are prepared to continue the constructive dialogue on these matters both with Venezuela and in the framework of a broader multilateral interaction in this sphere," he went on.

Energy opens up most favorable prospects for cooperation between the two countries. A number of big Russian energy companies display interest in taking part in it.

Potentially successful areas of bilateral ties could be also gas production, petrochemistry, coal production and development of transport infrastructure. Russian-Venezuelan cooperation projects in this sphere, which are of mutual interest, are possible.

Yakovenko further said that "the present meeting is an important landmark in the development of political contacts with Venezuela." They have grown most active as a result of the two Moscow visits by President Hugo Chavez and the visit by Prime Minister Mikhail Kasyanov to Caracas in 2001.

It is noted with satisfaction in Moscow that "the approaches of Russia and Venezuela are close as regards problems of shaping a modern system of international relations based on multi-polarity and respect for international law," the diplomat pointed out.

In his view, the "closeness or our approaches to the key problems of our time provides a firm groundwork for continued cooperation between Russia and Venezuela on a bilateral and multilateral basis."

The visit by Venezuelan Foreign Minister Roy Chaderton Matos will last until May 18.

Reuters, 05.12.03, 4:53 PM ET

CARACAS, Venezuela, May 12 (Reuters) - Venezuela's giant Amuay-Cardon refinery on Friday will export its first cargo of reformulated gasoline (RFG) to the United States since a crippling oil strike earlier this year, a spokesman for Petroleos de Venezuela (PDVSA) said on Monday.

"The ship is going to leave on Friday," the refinery spokesman said, adding the shipment was for 300,000 barrels of RFG.

U.S. traders have said they will be watching the cargo closely to determine if the cleaner burning gasoline meets specifications. Venezuela in recent weeks has sold two cargoes of RFG as conventional gasoline because it was not up to specifications.

The 940,000 barrel per day (bpd) Amuay-Cardon plant, Venezuela's largest export refinery, has not exported RFG since early December when foes of President Hugo Chavez began a two month oil strike.

Amuay-Cardon officials said last week that exports of RFG would be restarted by Wednesday. RFG, used in parts of the United States to combat smog, makes up roughly a third of the 9 million bpd of gasoline consumed in the United States.

On Tuesday, PDVSA also plans to restart a 84,000 bpd hydrodesulphurisation unit at Amuay shut late April due to a fire, the spokesman added.

Venezuela, a top supplier of RFG to the United States, fired over 18,000 employees for participating in the strike and used replacement workers and troops to restart its 1.3 million bpd domestic refining system.