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Venezuela, Cuba to Begin Oil Exploration Off Caribbean Island

Venezuela's state-owned oil company says it is beginning to explore for oil in Cuban waters as part of a joint venture with the island's state-owned Cubapetroleo.

Petroleos de Venezuela (PDVSA) said in a statement that the project would cover a 10,000-square-kilometer area and begin Wednesday. The Venezuelan company says it expects to confirm the presence of light crude oil after conducting a seismic study.

Earlier this year, Venezuela offered discounted oil to Cuba, Bolivia, Nicaragua and Haiti in exchange for becoming the sole provider to those countries. Venezuelan President Hugo Chavez said his country's oil will help with both economic and social development in the area. The proposal called for Venezuela to offer oil at a 50 percent discount.

Venezuela sells about 98,000 barrels of crude oil daily to Cuba. In return, Cuba provides Venezuela with medical personnel.

Some information for this report was provided by AP.