BEIJING -(Dow Jones)- Venezuelan President Hugo Chavez said Tuesday he had three strategic energy objectives in his latest visit to China, the first being how to arrange for Chinese oil companies working in his country to boost their oil output and supply China with 1 million barrels a day by 2013.

Speaking on arrival in Beijing for a three-day visit, his sixth to China since taking power, he said the second was to review the status of a planned joint venture oil refinery to be built in China, "which is nearly ready to be launched."

The third is the creation of a bilateral Venezuela-China oil shipping company, he told journalists.

Venezuela and China have signed several energy cooperation agreements over the past year, the latest being on Feb. 18, when Beijing agreed to a further $6 billion cash infusion into a bilateral development fund, and state oil company Petroleos de Venezuela SA, or PdVSA, agreed to sell an additional 80,000 to 200, 000 barrels of oil a day to PetroChina Co. (PTR).

The two sides also plan to build joint venture refineries in both China and in Venezuela.

On March 13, China National Petroleum Corp. President Jiang Jiemin said a proposed venture with PdVSA to build a 400,000 barrel-a-day refinery in Southern China to process Venezuelan oil still needed the approval of state economic planner, the National Development and Reform Commission.

Chavez will have talks with President Hu Jintao Wednesday, followed by a meeting with Vice President Xi Jinping Thursday.

Venezuela supplies China with about 300,000 barrels of Venezuelan crude a day, with around two-thirds of this in the form of high-sulfur fuel oil.

Chavez said that volumes towards the end of 2008 were higher than that, at close to 380,000 barrels a day, and that how to increase that volume to 1 million barrels a day by 2013 "is a strategic objective for Venezuela and China."

Venezuela is struggling to increase China-destined volumes due to its declining oil output and production cuts agreed with the Organization of Petroleum Exporting Countries.

To help boost its oil output, Venezuela has invited bids from foreign firms to develop heavy crude reserves in the Carabobo area of the Orinoco basin.

Venezuela's government says the area contains 272 billion barrels of recoverable reserves and it needs to attract foreign investors to help shoulder the huge financial burden needed to extract the oil - something Caracas can't do alone at a time of relatively low oil prices and reduced revenues.

It is now evaluating bids from, among others, CNPC, the nation's top oil and gas producer and the parent of PetroChina, and China Petrochemical Corp., or Sinopec Group.

It isn't clear when decisions will be made on those bids.

Chavez added that in his talks with the Chinese leader, he would review political and geopolitical developments, including the recent G20 meeting in London, the role of the International Monetary Fund and developments in Latin America and the Middle East.

Chavez and oil minister Rafael Ramirez arrived from Tokyo after signing a string of memoranda on possible Japanese energy projects, which the president said might lead to investments in Venezuela of $33.5 billion.

-By Simon Hall, Dow Jones Newswires; +86-106566 5848; simon.hall@dowjones.com

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  04-07-09 1155ET
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