Venezuelan president Hugo Chávez announced the creation of a fund to help victims of Saturday’s oil refinery explosion, whose death toll has now been revised up to 41, with a number still unaccounted for.

The fund of 100m bolĂ­vares (US$23m) has been put aside for reconstruction works, compensation for victims, pensions for widows and grants for the children of the deceased to study.

The fund will be jointly administered by the Venezuelan petroleum organisation, PDVSA, and the government of the state of FalcĂłn.

Some 500 houses were affected by the explosion, with more than ten completely lost in the blast. Chávez also announced that for those who had lost their homes, 60 houses were ready for families, with a further 200 promised over the course of the next month.

The president went on to thank all the emergency workers and medical staff who had been working around the clock since the blast.

Firefighters continue to battle with the flames, although the situation is now said to be under control.

The refinery remains closed as a result of the damage caused by the blast, and that, combined with the closing of off-shore rigs in the Gulf of Mexico as a result of Tropical Storm Isaac, currently sweeping through the Caribbean, is likely to lead to a spike in the price of oil.

Venezuela experienced one of its worst oil industry related disasters in history as a huge explosion tore through the Amuay refinery on Saturday, killing 39 and injuring at least 80. Amongst those killed were 18 members of the national guard who had entered the refinery after the explosion in an attempt to rescue survivors.

The blast was so strong it threw balls of fire into the air, and ripped windows out of nearby homes, leaving the streets strewn with rubble and debris. A day after the blast, flames reaching over 30m into the air could still be seen. The explosion appears to have been caused by a natural gas leak.

President Hugo Chávez declared three days of national mourning, but said Amuay, Venezuela’s biggest refinery, and one of the biggest in the world, would be up and running again within two days, and assured the country would meet its international fuel commitments.

Amuay is part of the Paraguaná refinery complex based in Punto Fijo in western Venezuela, which also includes the Cardón refinery. Together, they process about 900,000 barrels of crude a day and 200,000 barrels of petrol.

The Minister for Federal Planning, Public Investment and Services, Julio De Vido, announced that oil company YPF and Venezuela’s petroleum company PDVSA will be working together along with Argentina’s state-owned energy company Enarsa.

Governments of both countries agreed that the working alliance will open up opportunities to extract crude oil in Venezuela’s Faja del Orinoco as well as non-conventional resources in Vaca Muerta, an oil and gas field in Argentina’s Neuquén Province. It is hoped that the new plan will create a 60% increase in YPF’s oil refining capabilities over a five-year period.

YPF’s five-year plan contemplates the creation of 132 new mine shafts over 40 square kilometres in Vaca Muerta, with plans to produce 55 million barrels of oil, a number that they expect could be increased twofold in the following five-year period. PDVSA has shown interest in investing on exploration in Vaca Muerta.

Together, PDVSA and YPF also plan to expand the oil refinery in La Plata, invest US$1.5bn into a petrochemical complex in Bahía Blanca, and build a “regasification” plant for YPF and Enarsa.

The announcement of the collaborative union comes days before the official incorporation of Venezuela into regional trading bloc Mercosur, due to take place on 31st July.

“Mercosur will be a powerful economic bloc with Venezuela’s incorporation,” said Venezuela’s foreign minister, Nicolás Maduro, on state television (VTV).