Costa Rica's refinery abandons Chinese oil refinery deal. In the photo the  Moín (Limón) refinery
Costa Rica’s refinery abandons Chinese oil refinery deal. In the photo the Moín (Limón) refinery.

QCOSTARICA – Last week, Costa Rica’s State refinery, the Refinadora Costarricense de Petroleo (RECOPE) decidedt to abandon the US$1.5 billion dollar refinery project upgrade it was working with the China National Petroleum Corp (CNPC).

Today (Monday) the Chinese have called for talks.

In 2009, RECOPE and CNPC formed a company called SORESCO, to build a refinery in Moin (Limon). But the project has been paralysed since 2013 by Costa Rica’s Comptroller (Contraloria) after complaints of conflicts of interest in the feasibility studies.

Costa Rica’s decision to break from SORESCO was taken after the Asians negotiated a sale of 90% of its shares with Petroleos Mexicanos (Pemex), confirmed Enrique Rojas Franco, SORESCO’s laywer in Costa Rica.

According to a report by La Nacion, the lawyer says that he traveled twice to Mexico in March to meet with senior executives of Pemex, to negotiate the participation of that company in the project of the new refinery.

“They (Pemex) showed interest and I left them documents…” Rojas said.

Rojas added that it had not yet reported (the Mexico approach) to RECOPE. However, RECOPE’s decision took him by surprise.

Last Thursday, Sara Salazar, RECOPE’s CEO, announced the decision during her appearance a hearing of the Commission on Control on Income and Public Spending.

Chinese Foreign Ministry spokesman Lu Kang said he had noted the media reports on the issue, adding that relations have been developing well in recent years.

“As for individual problems that arise during our cooperation, we hope the relevant companies in both countries can continue to increase communication, understand each other’s concerns and find an appropriate resolution,” he told a daily news briefing, without elaborating.

Costa Rica made the surprise move of breaking off its decades-long relationship with Taiwan in 2007, now only recognized by a handful of small countries, including the rest of Central America.

China lent Costa Rica nearly US$400 million in 2013 during a visit by China’s President Xi Jinping.

For his part, the Minister of Foreing Relations, Manuel Gonzalez,  said that diplomatic relations between the two nations will not deteriorate by RECOPE breaking with SARESCO.