Suriname has signed on to the PetroCaribe accord, under which Venezuela sells oil to Caricom countries on concessionary terms.

The agreement, inked last week in Caracas, will see Suriname paying upfront 60 per cent of the cost of the oil it buys under the facility.

The other 40 per cent will be repayable over a 25 year period at one per cent interest.

But Suriname's Energy Minister Gregroy Rusland also said the deal would give his country access to about US$900,000 annually to finance investments.

Suriname's signing on to PetroCaribe represents a reversal of position that the accord would hurt its own oil industry.

Under the agreement, Venezuela's PDV-Caribe will supply crude to Suriname's state-owned oil company Staatsolie to refine.

PDV Caribe was created by the state-owned PDVSA to service commitments under the PetroCaribe accord.

Rusland said Staatsolie would oversee the implementation of the agreement.

"We will see to it that this deal won't have negative effects on other oil companies as Texaco, Esso and SOL," he said, adding that the PetroCaribe deal would be supplemental to other oil arrangements.

"What we don't want is that the activities within the framework of the PetroCaribbean agreement will have negative effects on the operations of Staatsolie; that's why we had to look for a slightly different agreement than the other CARICOM (Caribbean Community) nations," Rusland said.

Only oil-rich Trinidad and Tobago and Barbados have not signed the PetroCaribe deal.

- CMC