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Repsol welcomes Bolivian deal
AFP
MADRID
Petroleumworld.com 10 30 06
Spanish energy giant Repsol on Sunday welcomed an agreement between the Bolivian government and foreign oil and gas companies on ways to nationalize the country's gas industry.
The deals will allow the left-wing administration of President Evo Morales to move ahead with its nationalization plans for the gas industry that are expected to bring in billions of dollars in revenue to fight poverty.
In a statement Repsol said Saturday's deal with the company would permit "new investments" in the poorest South American nation.
The agreement "will allow the development of new investment projects in the country," Repsol said, as it "guarantees legal security for investments, indispensable for developing our activities."
Morales had in May given foreign companies 180 days to renegotiate contracts but stressed he wanted Repsol to stay in Bolivia, where the Spanish firm has invested 1.1 billion dollars since 1997.
Morales, his country's first indigenous leader, in May shocked financial markets by nationalising the country's energy sector and giving foreign firms notice they must agree to new contracts with Bolivian state producer YPFB.
The news prompted Repsol to say it would seek to reduce its dependence on Latin American activities.
Repsol, the world's seventh-biggest energy producer, accounted for 25.7 percent of Bolivian gas production prior to nationalisation.
La Paz also signed an agreement with Brazilian oil and gas giant Petrobras, which controls almost half the Bolivian gas market.
Bolivia has the second-largest gas reserves in South America, after Venezuela, at 1.55 billion cubic metres.
"The hydrocarbons are and will be the Bolivian people's," said YPFB head Juan Carlos Ortiz after the deals were signed.
AFP 29 1634 GMT 10 06
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