Venezuela bids cheap oil to tribes

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Venezuela bids cheap oil to tribes

Others have taken deal from controversial leader

 

By Krista J. Kapralos and Lukas Velush

Herald Writers

 

 

 

 

 

 

Venezuela's state-owned oil company wants to offer deeply discounted

home heating oil to American Indian tribes throughout the Pacific

Northwest.

 

Representatives of oil-giant Citgo Petroleum Corp. have contacted the

Tulalip Tribes, the Yakama Nation in central Washington, the Nez Perce

and Coeur D'Alene tribes in Idaho and many others with information

about a possible 40 percent discount on home heating oil.

 

Citgo is a Houston-based subsidiary of an oil corporation controlled by

Venezuela and Hugo Chavez, its controversial elected president who has

been called a dictator by U.S. leaders.

 

The idea of bringing discounted heating oil to West Coast American

Indian tribes is still in the exploratory stage, Citgo spokesman Jorge

Toledo said.

 

" We're going to meet with some tribes in the West Coast within the next

few weeks to consider the feasibility of a program there, " he said.

There's a local meeting scheduled for Wednesday at a hotel in SeaTac.

 

Heating oil is widely used on the East Coast, but has largely, though

not entirely, been replaced by natural gas in the West. Heating oil is

essentially the same product as diesel fuel.

 

Savings for tribes

 

Citgo first delivered discounted heating oil to low-income communities

last year in Massachusetts, New York and other Northeast states.

 

With the motto " From the Venezuelan heart to the U.S. hearths, " Citgo

sold fuel to eligible homes and nonprofit organizations.

 

By spring, Citgo delivered nearly 40 million gallons of heating oil to

181,000 households in the Northeast, Citgo President Felix Rodriguez

said.

 

Citgo's offer comes amid a war of words between Chavez and President

Bush.

 

Chavez is arming his country against what he contends is an impending

American invasion, and opposes capitalism. The Bush administration is

warning that Chavez is a " negative force " in South America, which is

still recovering from decades of dictatorships.

 

The city of Chicago declined a deal with Citgo for fueling public

buses, which could have saved the city $15 million. City leaders said

they were reluctant to deal with Chavez.

 

Chavez has signed energy deals with France, India and China, and is

looking for other allies against " the imperialist power, " according to

the Washington Post.

 

Even so, the Citgo heating oil program is winning fans.

 

When members of the Penobscot Nation in Maine heard about the program

in October, they contacted the Venezuelan embassy and asked if they

were eligible.

 

" Within 24 hours, the embassy's response was, 'Yes, they are,'

and it

stunned us, " tribal chief James Sappier said.

 

Within weeks, Sappier and leaders of three other tribes met with Citgo.

In February, they bought nearly 1 million gallons of heating oil,

enough to heat 912 family homes and several tribal complexes through

the winter.

 

Tribal members paid $1.47 per gallon for heating oil that would have

cost them $2.52 per gallon, Sappier said. They saved more than $1

million.

 

" This has been one of the best things we've ever done for Indians and

our tribe, " he said.

 

So far East Coast tribes haven't resold the heating oil, though some

tribal leaders are discussing selling other types of fuel from Citgo to

raise revenue.

 

Going nationwide

 

Citgo sent representatives to a national tribal conference in May to

spread the word about the fuel discount.

 

" It's exploratory at this stage, " said David Conrad, director of the

National Tribal Environmental Conference. " They want to see if there's

enough people on home heating oil to make enough economic sense to

expand it to those states. "

 

Citgo also has contacted tribes in the Southwest, where discussions

have just started.

 

In the Pacific Northwest, many tribal leaders know little more than

what was said in an e-mail brochure from Citgo that began circulating

this week.

 

Steve Gobin, deputy general manager of the Tulalip Tribes' Quil Ceda

Village, said he plans to attend the meeting.

 

There are only four or five families on the Tulalip Reservation that

currently receive assistance from the tribe with their home heating

oil, but Gobin suspects there may be other families who could qualify

for a discount.

 

About 6,000 homes in Snohomish County heated their homes with oil in

2000, according to U.S. census data.

 

Citgo isn't saying how it would deliver fuel locally. On the East Coast

it used local distributors.

 

Most heating oil burned in the Pacific Northwest is refined at four

refineries in the Anacortes and Ferndale areas, said Lea Wilson,

executive director Washington Oil Marketers Association. The refineries

convert crude oil into heating oil, diesel, gasoline and aviation fuel.

 

About half the region receives fuel transported by Olympic Pipe Line

Co., which starts in Blaine, stretches south through Snohomish County,

and ends in Vancouver, Wash.

 

Wilson said Citgo could buy heating oil from one of the refineries and

ship it through the pipeline. A tanker also could deliver it directly.

She said she's not familiar with Citgo's plan.

 

Corporate generosity

 

Citgo spokesmen describe the program as an indicator of corporate

responsibility.

 

The discounted oil is a donation and tax write-off for Citgo, Sappier

said.

 

Citgo officials say the program is a response to a letter U.S.

lawmakers, including Sens. Maria Cantwell, D-Wash.; Hillary Rodham

Clinton, D-N.Y.; John Kerry, D-Mass.; and others, sent to oil

companies. They asked the companies to help ease the financial burden

of high fuel costs on America's poor.

 

" The only company that responded was Citgo, " Sappier said. " Where

the

devil is Exxon or Shell? "

 

Chavez's fuel program has improved life for thousands of American

families in need, Sappier said. Now, the Penobscot Nation's Web site

features photos of Chavez taken on a tribal trip to Venezuela.

 

Attacks on Chavez by U.S. officials " demean " the best fuel program in

the nation. " It has come from another country, but it's the best, "

Sappier said.

 

Oil and politics

 

Recent barbs traded by Chavez and Bush could scare tribes away from

Citgo, Conrad said.

 

" It's just a business deal, " he said. " I don't know that

there's any

political lay to it other than just background noise. "

 

Bush has likened Chavez to Hitler. Chavez has repeatedly referred to

Bush as a " terrorist " and " a madman. "

 

In brochures circulated among Pacific Northwest tribal leaders, Chavez

said the program brings a better life to the poorest and most

vulnerable people.

 

" This program fulfills a promise I made to the people of the United

States, and it is a gift warmly given to our American friends, " Chavez

said.

 

Cantwell did not respond to questions about whether the letter she

signed has attracted Chavez to the state.

 

In an e-mail, Cantwell said she welcomes any oil company's efforts to

help low-income families pay their heating bills.

 

Cantwell spokeswoman Charla Neuman later said in an e-mail that what

matters is that this program could help Washington state families,

regardless of political motivation.

 

" I don't think any of us really believe oil companies make decisions

from their hearts, " Neuman said.