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Try this recipe: http://www.food.com/recipe/creamy-potato-parsley-...
Yes, Valencia rice originates from the Valencia region in Spain and is classically used to make paella. If you can't find Valencia rice, you can substitute the Italian short-grain Arborito. It's typically used to make risotto, and is available in many supermarkets.
Cooking is complete when the rice is tender and has absorbed all of the cooking liquid. Tip the pot to the side to check on the water, and taste a grain of rice to check on doneness.