PetroCaribe is an energy union between Venezuela and eighteen (18) Caribbean countries thus far. These countries include Antigua and Barbuda, the Bahamas, Belize, Cuba, Dominica, the Dominican Republic, Grenada, Guyana, Jamaica, Nicaragua, Suriname, St. Lucia, St. Kitts and Nevis, St. Vincent and the Grenadines, Haiti, Honduras and Guatemala. The agreement was first signed at Puerta La Cruz, Venezuela on 29th June 2005, and is based on the political principles of unity, solidarity, cooperation, complementarity, energy security, socio economic development, sovereignty with regard to the use of energy resources, conservationist vision and looking towards the south.
The features of the agreement include an institutional platform, ALBA Caribe Fund for social and economic development, operating aspects, financing mechanisms and compensations, and energy efficiency.
Under the institutional platform, a Ministerial Council formed by the Ministers of Energy or their equivalents will be formed to help PetroCaribe achieve its objectives. The Council will be responsible for five main functions. They will have to coordinate relevant policies, strategies and plans. They will also have to delegate functions and responsibilities to the agencies created for the fulfillment of specific tasks, whenever necessary. Thirdly, the will have to agree on and approve issues of absolute priority to the organization, as well as studies, workshops and work sessions, with a view to providing the necessary technical and legal support for these issues. Another function of the Council includes, exercising its fullest authority with regard to the performance of the Executive Secretariat and agreeing on the admission or withdrawal of members whenever required. The Council of Ministers also has a President and a Deputy who calls and chair meetings. Regular meetings are held once per year as well as special meetings which are held as often as necessary.
The Executive Secretariat ascribed to the Ministry of Energy and Petroleum of the Bolivarian Republic of Venezuela is also responsible for five main functions. These include, preparing agendas of the meetings of the Council of Ministers, directly managing and administering PetroCaribe – related affairs, ensuring the implementation and follow-up of the decisions adopted by the Council of Ministers and submitting the relevant reports and recommendations, also, proposing the allocation of resources for the performance of all necessary studies.
To help foster the social and economic development of the countries of the Caribbean, PetroCaribe has at its disposal the ALBA Caribe Fund. This Fund is earmarked for the financing of social and economic programs and consisting of contributions from financial and non financial instruments. Such contributions may, upon agreement, be drawn from the financed portion of oil invoicing and the savings from direct trade. Venezuela activated the Fund with an initial contribution of US$ 50 million. The Operating Aspects deals with the creation of PDV Caribe, a special – purpose affiliate of Petroleos de Venezuela (PDVSA). This affiliate has to possess sufficient cargo capacity for covering its supply-related obligations. Freight expenses arising from these operations shall be...