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Bolivia, Brazil reach accord over gas price
AFP/Jose Paulo Lacerda
Brazilian President Luiz Inacio Lula da Silva (R) shakes hands with his Bolivian counterpart Evo Morales during a meeting at the Planalto palace in Brasilia.
AFP
BRASILIA
Petroleumworld.com 02 15 06The presidents of Brazil and Bolivia reached an agreement Wednesday in their dispute over Bolivia's demands for Brazil to pay more for its natural gas.
Brazilian President Luiz Inacio Lula da Silva met for several hours with his Bolivian counterpart Evo Morales in Brasilia, where they reached a "very satisfactory" agreement, said Lula's foreign affairs adviser, Marco Aurelio Garcia.
Details of the deal will be unveiled Thursday, Garcia said.
A Bolivian diplomatic source confirmed that a deal was struck and said it includes a price adjustment, which Brazilian officials refused to confirm.
Bolivia supplies about half the natural gas consumed by Brazil. Their dispute over prices has lasted more than a year.
Morales insists the gas is sold far too cheaply and that Bolivia, South America's most impoverished nation, could not continue "subsidizing" its giant neighbor.
But Brazilian authorities expressed opposition to the proposed price increases.
Bolivia wants Brazil to pay five dollars per million British thermal units, up from the 4.30 dollars per million BTU Brazil's state-run Petrobras pays for the 26 million cubic meters (918 million cubic feet) it imports daily.
Bolivia did secure Wednesday a price hike from a Brazilian private firm.
Termo Cuiaba, which imports 1.2 million cubic meters (42 million cubic feet) a day for its thermoelectric plant in Mato Grosso state, will pay 4.20 dollars per million BTU, four times what it currently pays, officials from both countries said.
Morales was elected in December 2005, vowing to nationalize Bolivia's energy industry. Two months ago the leftist leader issued a decree formalizing Bolivia's takeover of the natural gas industry.
AFP 15 0332 GMT 02 07
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