UNCLAS BELIZE 000937

SIPDIS

SIPDIS

STATE FOR WHA/CEN//JASON MACK
STATE PLEASE PASS TO EXIM//MICHELE WILKINS AND MICHELLE D. MILLER
STATE PLEASE PASS TO DEPARTMENT OF ENERGY

E.O. 12958: N/A
TAGS: ECON EFIN ENRG EPET PREL SOCI BH
SUBJECT: BELIZE: GOB CONSTRUCTING HOLDING TANKS FOR
VENEZUELA OIL UNDER PETRO-CARIBE DEAL



1. On October 18, Econ FSN spoke with Zaid Flores, General Manager
of the Belize Banana Grower's Association and one of three
owners/directors of the Big Creek Port, who confirmed that the
Government of Belize (GoB) has contracted the services of the Big
Creek Port to handle all on-ground logistics for the construction of
holding tanks for Venezuelan oil under the Petro-Caribe arrangement.
The GoB project, according to Flores, calls for the construction of
four to five holding tanks. Flores noted that the other two
owners/directors of the Big Creek Port are Mike Dunker and Tony
Zabaneh, both major owners of banana plantations in southern
Belize.


2. Econ FSN also spoke with Exxon Mobil country representative
Guillermo Alamina on October 24, who said that "the entire GoB-Petro
Caribe deal is shrouded in secrecy" because every time he tries to
get information about the arrangement from the GoB, "no one wants to
talk." Alamina added that his staff visited the Big Creek Port
recently and observed the construction of two holding tanks on land
owned by Dunker that is inside the port compound and adjacent to the
Belize Natural Energy fuel depot. Alamina's staffers believe that
these two tanks under construction are the GOB's - a revelation that
Flores did not disclose.


3. Alamina confided that not too long ago Luke Espat, owner of the
Ports of Belize Limited, offered to purchase the Exxon Mobil fuel
depot near Port Loyola in Belize City "to accommodate Venezuelan
oil." Alamina explained to Espat that Exxon Mobil's terminal was
not for sale, but that he would nonetheless forward the offer to the
company's headquarters. As expected, Exxon Mobil turned it down.
Upon hearing this, Espat replied that he would go ahead and build a
terminal anyway.


4. A visiting U.S. businessman told Ambassador and DCM that he had
seen the construction site at Big Creek and observed that the tanks
were poorly built. For example, there is presently no catchment
basin to contain spills and the welding is of poor quality. He also
noted that the proposed method of transferring Petro-Caribe oil from
ship to tank was unsafe. He expressed concern that operations at
the tank farm would eventually result in a major oil spill.

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