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      Refinery Accident Highlights National Oil Company's Exploitation

      Hugo Chavez has fended off accusations of safety lapses at a refinery of the state oil company that has become synonymous with his regime.
      By Amiel Ungar
      First Publish: 8/28/2012, 3:04 AM

      Chavez at refinery
      Chavez at refinery
      Reuters

      Venezuelan President Hugo Chavez was quick to go into damage control mode in response to an oil refinery blast that has so far resulted in 41 fatalities.

      President Chavez, who has already ordered an investigation and declared 3 days of national mourning, was quick to rule out safety lapses at the refinery, although nearby residents claimed that they had detected the smell of sulfur, indicating a leak before the blast.

      "What you say you heard suggests something that is practically impossible in an installation of this kind, the largest refinery in the world. It is completely automatized and it has thousands of responsible workers here day and night, civilians and military", retorted Chavez.

      Neutral experts were less certain and pointed to other accidents that have already occurred this year.

      The refinery belongs to the state's petroleum company PDVSA and, like Gazprom in Russia, it has become effectively a policy arm of the regime. Back in 2002, following a period of labor unrest in Venezuela, 20,000 PDVSA employees - including many of the most technically skilled - were fired because their loyalty to Chavez was suspect.

      The company last year contributed nearly $50 billion --double its previous year's commitments --to finance government social programs to boost government popularity in the runup to the October 7 elections. To help pay for its generosity, it has sold bonds to China worth $10 billion. If oil prices remain high. the company will be able to cope with debt service estimated as costing up to $7 billion per annum in the next 5 years.

      As its resources are diverted to bolster the Chavez government and pay for its massive social programs. critics charge that it economizes in other areas such as job safety. For example. the company failed to perform the required number of maintenance shutdowns at the stricken refinery.

      Hugo Chavez was quick to rebut such charges, claiming that this construction of events was serving the opposition's political agenda. Chavez' opponent Henrique Capriles has not sought to exploit the issue and has contented himself with messages of condolence and wishes for the recovery of those wounded.