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Latin American Realpolitik: Colombia Cuts Electricity to Venezuela, Ecuador
Gas supply to Venezuela seen as next to be cut, as U.S. ally Uribe ups the stakes in escalating dispute with Chavez and Correa.

By Jeremy Morgan
Latin American Herald Tribune staff

CARACAS – Colombia will reduce electricity exports to Venezuela and Ecuador due to natural gas supply shortages in some parts of the country, Colombian Energy and Mines Minister Hernan Martinez said, and left open the possibility that Colombia may be set to turn a temporary suspension of gas deliveries to Venezuela caused by what were initially described as difficulties of a “technical” nature into a more lasting cut. And, it would seem, it might not only be gas that’s affected.

“We’re going to cut back a little on electricity exports to Ecuador and Venezuela,” Martinez told reporters, adding that the measure would go into effect gradually beginning Wednesday.

Martínez also said that Bogotá didn’t “rule out the possibility” of having to “restrict” exports of gas to power stations in Venezuela “indefinitely” – and that the same would apply to Ecuador.

Some reports had it that this was actually the government’s intention, and that the decision had already been taken. In the light of Colombia’s continuing stand-off with both Ecuador and Venezuela, the decision quickly came to be seen in a distinctly geopolitical light in Caracas.

Martínez had reportedly said that gas supplies to both Venezuela and Ecuador would be limited because there was a need to attend to the domestic supply to be used to generate electricity for the domestic market.

The aim of reducing gas exports to the two countries, he said, would be to divert 30 million cubic feet a day of natural gas from power stations in Colombia to the auto industry.

“We’re having a little deficit of gas in the center of the country, chiefly because we don’t have the capacity to transport more than 190 million cubic feet (a day) of gas,” he explained. This was the reason why there was a need to limit exports of gas to the two other countries, he added.

Districts in and around the Colombian capital, Bogotá, are said to be suffering from shortages of compressed natural gas for vehicles because the fuel is being diverted to power generation. This in turn is explained by a fall in hydroelectricity output because seasonal rains have been below normal.

With respect to this, Martínez was said to have spoken in terms of conserving water in lakes behind hydroelectricity dams because it was not known how long the “drought” would last. Until that became clear, he said, it would be necessary to use more gas and coal to generate electricity to meet domestic demand.

Martínez’s explanation that the decision to cut short supplies to Venezuela was motivated by domestic energy needs appeared to gain little credibility – if any – in official circles in Caracas.

There, it seemed, the decision was attributed to Colombian President Álvaro Uribe’s continuing dispute with Presidents Hugo Chávez and Rafael Correa of Venezuela and Ecuador, respectively.

“This is all hogwash,” exploded a Venezuelan official, once he’d been assured that his remarks would remain firmly off the record. “Suddenly, there’s a power crisis in central Colombia and we get screwed. Right now. How convenient. This is politics, nothing more.”

Be that as it may, Martínez was said to have to gone to some lengths to emphasize that any cutbacks in deliveries to Venezuela would not be total. At this distance, the minister’s tone sounded almost apologetic, if not actually regretful.

But he then went on to reveal that cutbacks could also affect Colombian supplies of natural gas to Venezuela. “The paradox is that we’re exporting to the neighboring country and we lack the fuel in the interior,” he told a local radio station.

There were problems with distributing gas produced in Caribbean fields in Colombia to the interior of the country and these had to be resolved, he continued, and cutting gas exports to Venezuela would resolve the situation in the interim.

Investments worth $500 million were being made to overcome problems in gas production and transportation system in the east of the country, and these would be ready in March next year.

The minister gave no indication of how long cuts in gas shipments to Venezuela might last. Colombia produces 1.1 billion cubic feet a day (1Bcfd) of gas, of which it exports 250 million cubic feet a day (2MMcfd) to Venezuela.

The gas is delivered to parts of western and southern Venezuela where supplies are insufficient to meet local demand. The reason for the shortfall, it’s claimed, is that infrastructure projects planned by the state oil corporation, Petróleos de Venezuela (PDVSA), have yet to be completed.

Colombia, relatively short of energy resources compared with its neighbors, also exports electricity to both Venezuela and Ecuador. Official figures show that in August, 100.2 MW hours of Colombian electricity was delivered to Ecuador to a value of $8.7 million, while shipments to Venezuela are said to have come out at 120 MW hours for about $10million.

Martínez was not reported to have said whether the cutbacks enforced by domestic supply difficulties on natural gas exports might also apply to electricity deliveries at some stage in the future.

Back in Caracas, the same exasperated official reckoned he already knew the answer. “That’ll be the next thing,” he said, with what sounded rather like a touch of resignation. “All we have to do is sit back and wait. It’ll happen.”

In official circles, the fact that Venezuela – which has the largest estimated natural gas reserves in the Western Hemisphere, some 151 trillion cubic feet at the last official count – is having to ship gas in from Colombia is privately deemed a bit of an embarrassment that will eventually fade into thankfully forgotten history.

The same long-distance pipelines are to be used to send Venezuelan gas over the border to Colombia, possibly starting in 2012. However, this will hinge on PDVSA getting its act together on producing the gas, and unconfirmed reports in industry circles talk of delays in getting gas fields ready to produce.

A cutback in electricity supplies from Colombia could be an altogether much more serious matter. For years, Venezuela’s electricity sector has been creaky and subject to black-outs – five major ones this year so far.

Critics claim that the deterioration in electricity output and distribution in Venezuela has gotten worse since President Hugo Chávez renationalized Electricidad de Caracas.

Chávez has earmarked $10 billion for investment in revitalizing the electricity sector in the next few years – and at times, he’s talked of twice as much. But plans for the power sector spending spree are said still to be at “the drawing board stage.”

The dispute between Chávez and Uribe has been rumbling for years. In its current reincarnation, the latest spark that set Chavez off was Uribe’s agreement to allow United States military forces to use bases in his country.

Chávez deems the bases agreement a threat to the region in general and to Venezuela in particular – and by implication, an underhand act on Uribe’s behalf. He has plunged political and trade relations with Venezuela into a “freezer” until further notice, cutting off exports of gasoline to Colombia border towns.

Colombia has been a major trading partner of Venezuela, with the bilateral balance massively in favor of Colombia over the years. The key point in all this is that Colombia has been a primary supplier of food, of which Venezuela imports an unofficially estimated half or more of its needs.

Uribe is at odds with Ecuador's Correa after Colombian armed forces launched an attack on a camp run by the Revolutionary Armed Forces of Colombia (FARC) on the Ecuadorean side of the border.

During the attack, the FARC’s second-in-command and so-called “foreign minister,” alias Raúl Reyes, was among those killed. Correa broke diplomatic relations on the grounds that Colombia had violated Ecuadorean sovereignty, and links remain broken to this day amid sporadic reports of discreet backdoor moves to restore them.


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