July 26, 2000
The Venezuelan government said Wednesday it will allow private companies to drill for oil in the Essequibo territory - the latest move in an escalating dispute over the mineral-rich region claimed by both Venezuela and Guyana.
"We're going to grant oil concessions in that area ... just as Guyana does," foreign minister Jose Vicente Rangel said in a television interview. He added that Venezuela has already contacted prospective oil companies.
Venezuela maintains it was unfairly stripped of the Essequibo region in a 19th century arbitration decision.
The Essequibo region comprises two-thirds of Guyana's land area of 83,000 sq. miles and is home to gold, diamond and timber investments by U.S. and Asian companies.
Oil sustains Venezuela's economy, accounting for more than 70 percent of its exports.
The long-standing dispute between the two countries was exacerbated last year when Guyana sold 100,000 acres in Essequibo to U.S.-based Beal Aerospace Technologies, which plans to build a satellite launchpad there.
President Hugo Chavez insists the U.S. government is providing security for the launching site, and may use it as a military base. The U.S. Embassy in Venezuela has stated that the United States has no role in the project except for granting export licenses.
The United Nations has been mediating the boundary dispute between Venezuela and Guyana during the last decade. Officials from Guyana, Venezuela, and the UN will meet in New York on Sept. 6 and 7 to try to negotiate a settlement.
