VENEZUELA - The Latin American Market.

Under the Chavez government, Venezuelan energy integration with fellow Latin American countries should accelerate. PdD M&M's Latin oil exports to America should rise. In a renewed San Jose Pact for regional co-operation in energy, Venezuela and Mexico have continued their joint supply of 160,000 b/d of crude oil and refined products to the Central American and Caribbean countries. Under the Caracas Energy Accord, PdV M&M supplies another 80,000 b/d to the San Jos Pact nations. Cuba gets 53,000 b/d of Venezuelan crudes under a five-year pact signed in late Oct. 2000 at the end of President Fidel Castro's visit to Caracas, with part of the crudes provided at a special discount, and Havana buys another 30,000 b/d through oil traders. A growing Castro-Ch vez alliance has been particularly disturbing to the US government.

PdV M&M is aggressively pursuing Brazil's oil market, the biggest in Latin America, which consumes almost 2m b/d. Petrobras has become an important client of PdV M&M for crudes, fuel oil and other products including LPG. During a visit to Caracas in April 2000, Brazilian President Fernando Henrique Cardoso discussed Ch vez' grandiose project of a multi-state PetroAmerica, joining the assets of Petrobras. PdV and several other Latin American NOCs. PdV M&M is selling gasolines to Ecopetrol of Colombia in a special deal - to curb contraband which involved about 7,000 b/d of Venezuelan mogas that used to enter the neighbouring country.