Venezuela plans to deliver inexpensive oil to Nicaragua.

The plan was announced Monday in Nicaragua by Venezuela's ambassador to Nicaragua, Miquel Gomez, Nicaraguan opposition leader Daniel Ortega, and the mayor of the Nicaraguan capital, Managua, Dionisio Marenco.

The officials say the agreement calls for the creation of Venezuelan controlled company in Nicaragua which would distribute oil to Nicaraguan cities at a 40 percent discount.

Officials note many of the cities which would benefit from the program - including the capital - are governed by members of Nicaragua's leftist Sandinista Party, FSLN, which ran the country from 1979 to 1990. Mr. Ortega is leader of the Sandinistas.

Venezuela is the world's fifth largest oil exporter and has already has oil deals with Argentina, Uraguay and some Caribbean nations.

Some information for this report provided by AFP and Reuters.