Work has begun at the Piedras Blancas plant near Nagorote west of Managua to expand the tank farm for storing oil. The Venezuelan government approved $250 million last December for this first phase of construction leading up to the installation of a new refinery, for a total investment of $4.5 billion. That refinery will be able to process 150,000 barrels of crude a day, far more than the 27,000 Nicaragua presently consumes. This would mean the country can become an exporter of petroleum derivatives to the rest of Central America and possibly the United States, bringing in an estimated $700 million a year.
Venezuela is also contributing to solving Nicaragua’s crisis with electricity that wracked the country’s economy last year by supplying several power plants that run on bunker fuel oil. An additional 180 megawatts will be coming on line in different stages over the year as the plants arrive and are installed. Some have pointed out that this increases the country’s dependence on petroleum; however, Venezuelan President Hugo Chávez has said, “All the energy resources Nicaragua needs for this whole century are in Venezuela and we make them available to the people of Nicaragua.”