Venezuela considers opening border to Colombia

OREANDA-NEWS. July 08, 2016. Venezuela is considering opening its border with Colombia, ending nearly a year of blockades that compromised thermal coal exports.

Colombian President Juan Manuel Santos yesterday said that Venezuela "has expressed its desire to reopen the border." Foreign minister Maria Angela Holguin met yesterday with the director of Asocarbon, which represents miners and exporters in the province, to create a roadmap to normalize transport of Colombian products through Venezuelan territory, including coal.

The pronouncement and meeting came a week after defense ministers from the two countries sat down to discuss a reopening. Borders between the countries have been closed since August of last year as Venezuela attempted to choke off smuggling of cheap Colombian products into the country. Venezuela also claimed that right-wing Colombian paramilitary groups were trying to infiltrate the country.

More than 220,000 metric tonnes of thermal coal from Colombia's Norte de Santander province were trapped at border crossings as Venezuela closed major routes to the Venezuelan port city Maracaibo for export.

"I am not going to commit to a date, but when we reopen the border (it is going to) be different," with greater control of smuggling, Holguin said yesterday.

Asocarbon director Jaime Rodriguez expects the reopening to take place over "a couple of weeks," possibly before 20 August.

Yet steam coal exporters, including trading companies Bulk Trading, Inter-American Coal, Trafigura and Colcarbex, might be reluctant to use the routes after they reopen, fearing new closures in the future, Rodriguez said.

Producers in Norte de Santander had shipped as much as 120,000t/month of steam coal through the C?cuta-San Antonio del Tachira border crossing to Venezuela's ports prior to its closure because that route cost about half as much as transporting coal to Colombia's Caribbean ports. But after the border was closed, Colombian companies struck deals to use several modes of transportation — including trucking coal from Norte de Santander to its own river port of Capulco and on to terminals in Barranquilla — to reach export markets.

Producers in the northeast part of the province have cut output by an average 25pc since August last year.