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ORIGINAL FRENCH ARTICLE: La Bolivie récupère son gaz

by Bernard Duraud

Bolivia Takes Back Control of its Natural Gas

Translated Monday 6 November 2006

La Paz. Evo Morales completed his nationalization plan last Saturday signing an agreement with all the multinational corporations in the gas sector.

Last Saturday, Evo Morales completed his program of nationalization of hydrocarbon resources in La Paz, by signing contracts with all the foreign corporations operating in this sector in Bolivia, allowing them to pursue their activity, but under the close control of the State. “The agreement was signed by all the corporations” declared Carlos Villegas, Bolivia’s hydrocarbons minister, just before the deadline of Saturday at midnight.

The Bolivian President expressed satisfaction with the outcome of the negotiations that had been long and difficult. From now on, Bolivia will exercise its ownership over its natural resources “without any expulsion or expropriation”. “This is nationalization without compensation for the companies - which is what many sectors of society had been demanding”, he declared.

According to the president, controlling natural gas at the source and the increase in financial resources (which should rise from $200-million as it stands today to $4-billion per year) will “help resolve the problem of social injustice and avoid public disorder in the future”. The next stage in taking control will be “the industrial sector”. Following energy, the government will turn its attention to minerals and non-ferrous metals and all non-renewable resources.

Among the corporations that have signed the agreement are the Brazilian Petrobras and the Spanish-Argentinian Repsol YPF, the two most important companies operating in Bolivia, controlling respectively 47% and 27% of Bolivia’s natural gas reserves. The French company Total which exploits 15.9% of these reserves and the American, Vintage Petroleum, 2.1%, had already signed last Friday. The agreement stipulates that these corporations will provide all their production to the state-controlled oil and gas company, Yacimientos Petroliferos Fiscales Bolivianos (YPFB). In exchange, they will receive, according to their respective contracts, between 18 and 50% of the value of the amount of resources they extract. YPFB will take on the marketing of the natural gas, establishing the supply and the prices of products in the internal market and export prices.

On May 1 2006, Evo Morales had announced the nationalization of the petrol and natural gas industries in the rich eastern part of the country (the largest gas reserves in Latin America, after Venezuela). He had given the multinational corporations six months to accept the new decree. Today, this strategy is beyond any doubt a political victory for Morales. Negotiations were difficult, uncertain and tense, especially with the Brazilian neighbor and friend, particularly when the interests of Petrobras were questioned. These tensions seem now a distant memory, says Evo Morales paying tribute to Lula of Brazil. “Without Brazil, life would be impossible. We have to remain married to Brazil, a leading country of the region. There can be no question of divorce, because we both need each other.”


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