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Iran, Venezuela Swap $760 Million Energy Investments

Venezuelan President Hugo Chavez (left) and Iran President Mahmud Ahmadinejad in Tehran on September 6.
TEHRAN (Reuters) -- Venezuela and Iran will each invest $760 million in the other's energy sectors under deals signed during a visit to Tehran by Venezuelan President Hugo Chavez, Iran's Oil Ministry website SHANA has said.

According to the website, state oil company Petroleos de Venezuela SA (PDVSA) would invest $760 million in the development of phase 12 of Iran's giant South Pars natural gas field in the Gulf.

"Based on the agreement, Iran also pledged to invest $760 million in the development of Venezuelan oil field Dobokubi as well as the development of Block 7 of the Ayacucho oil field," SHANA said on September 7.

Venezuela also pledged to export 20,000 barrels of gasoline per day to Iran for a total value of $800 million, the website said adding that the amount would be put in a fund that will be used to finance sales of machinery, technology and other services by Iran to Venezuela.

Iran is the world's fifth leading oil exporter but its refineries lack the capacity to meet domestic fuel demand, so it imports up to 40 percent of its gasoline. Iran imports an estimated 120,000 barrels per day of gasoline.

Tehran, in a face-off with the West over its nuclear program, may face sanctions on its gasoline imports if a diplomatic solution is not found.

On September 6, Chavez announced the plan to export gasoline to Iran. Iran's state television quoted him as saying the exports would start in October.

U.S. President Barack Obama has given Iran until later in September to take up an international offer of talks on trade if it shelves uranium enrichment, or face harsher punitive measures.

The South Pars reservoir is shared by Iran and Qatar. The Iranian part is divided into 24 phases.