Contraloría Approves China - Recope Oil
contract
The Contraloría General de la Republica
(Comptroller's Office) - Costa Rica's
legal watchdog - on Thursday cleared a
billion-dollar contract the government
signed with China to jointly build an oil
refinery after it was held up in legal
wrangling for months.
The Contraloría reversed its own earlier
ruling in March, when it said an agreement
signed in 2008 for the Refinadora
Costarricense de Petroleio (RECOPE) - Costa
Rica' state oil refinery - to form a joint
venture with the China National Petroleum
Corporation (CNPC) was invalid.
The government of President Oscar Arias,
which severed diplomatic ties with Taiwan in
2007 to open ties with China, signed an
agreement for the joint venture during the
visit of Chinese President Hu Jintao.
The Arias administration insisted on the
legality of the agreement, and reacted with
joy on Thursday when the office cleared the
contract.
"This is extraordinary news for the
country," said the president's brother and
ministro de la Presidencia, Rodrigo Arias.
The Contraloría – an independent
bureau that monitors government actions to
make sure they are within the law – had said
the joint venture would have violated the
RECOPE's legal monopoly on oil refining and
distribution.
It was not immediately clear under what
circumstances the Contraloría reversed its
earlier ruling, but in April the office said
the project could proceed only if
legislators changed the law.
The agreement includes the creation of a
joint venture bi-national company "in charge
of developing and putting in operation the
project to broaden the Moín (Limón)
refinery, to increase its production to
60,000 barrels a day," the Contraloría said
in a statement.
The to be built Moín refinery is
expected to dramatically increase the
country's current refining capacity.
The refinery is expected to generate between
1,000 and 1,500 direct jobs, and some 5,000
more jobs indirectly in the province of
Limon, according to the government.
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