Venezuela's state oil company is helping Grenada build storage tanks needed to store the fuel bought under the Petrocaribe deal. The lack of storage has been a key issue holding up the delivery of oil to the Caribbean.
Under the Petrocaribe deal which was finalized in June 2005, Caribbean countries pay market price for Venezuelan fuel but need pay only part of the cost immediately. The remaining can be paid over 25 years at low interest. The governments can also pay part of the amount with services and goods such as rice and bananas, while Venezuela will provide storage tanks and docking facilities.
The tanks will hold up to 20 days worth of Grenada's fuel needs - more than the current maximum of a 10 day supply.
Grenada's Petrocaribe program has been weighed down because it lacks the infrastructure to receive and distribute oil.
While 14 countries in the region have signed the Petrocaribe deal, itis unclear whether Grenada has received any oil under the agreement.
The Petrocaribe deal is seen as a bid by anti-Us Venezuelan President Chavez to make inroads in the Caribbean, where the US is a major trading partner. His deals are an opposition to the US free trade deals.
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