Venezuelan President Hugo Chavez sought to expand his petrodollar influence in South America as he launched a four-nation tour to promote his country's entry into a regional trade bloc and to offer energy and financial deals to allies.
Chavez met with Argentine President Nestor Kirchner late on Monday after signaling Venezuelan plans to acquire up to US$1 billion in Argentine bonds in installments -- the latest in a series of deals cementing ties between the allies.
"This is an important deal, highly important for our political and geopolitical ties," Chavez said.
He later joined Kirchner for a televised ceremony at the Government House in Buenos Aires in which the leaders agreed on a treaty on energy security.
The agreement calls for "ample and sustained cooperation" on energy initiatives, including the supply and distribution of natural gas through pipelines, joint oil refining projects and coordinated efforts on distributing power and alternative fuels.
Chavez said his government would invest in a regasification plant for liquid natural gas for Argentina, which is weathering an energy crisis.
The plant could be completed within two years, he said.
Chavez offered few details, but local reports said construction at a still-to-be-determined site would require at least US$400 million.
Kirchner responded to criticism over Argentina's sporadic natural gas and other energy shortfalls by blaming the shortages on unexpectedly robust economic growth after the country rebounded from a deep 2002 economic tailspin.
"Argentina is growing and it therefore requires more energy," he said.
Kirchner also said he strongly supports Chavez's bid to make Venezuela a full member of South American trade bloc MERCOSUR, joining Argentina, Brazil, Paraguay and Uruguay.
Legislators in Argentina and Uruguay have approved Venezuela's entry into MERCOSUR, but legislators in member states Paraguay and Brazil have yet to sign off over Chavez's confrontation with an opposition-aligned television station.
Several Brazilian lawmakers favor blocking Venezuela's entry, arguing the country does not comply with MERCOSUR's commitment to democracy because of Chavez's decision not to renew the broadcast license of Radio Caracas Television, or RCTV.
Chavez was making his first visit to Argentina since March, when he used a rally in a soccer stadium to rail against US President George W. Bush.
Chavez also met with Kirchner's wife, Cristina Fernandez de Kirchner, who is running to replace her husband in the Oct. 28 Argentine presidential elections.
"Even the stones in Argentina and Venezuela shout out that Cristina Kirchner will be president," Chavez said.