Bolivia, Private Companies Meet Over Nationalization

Bolivia's hydrocarbons and energy minister Carlos Villegas and the president of state oil company YPFB Juan Carlos Ortiz have met with representatives of the 10 hydrocarbons companies that operate in the gas-rich country, the ministry said in a statement.

Participants discussed the October 28 deadline to sign new contracts under Bolivia's nationalization decree.

None of the companies have requested an extension, according to the statement, although Brazilian press reported that Villegas might accept one.

The 10 companies are the following: Petrobras Bolivia; Petrobras Energia Sucursal Bolivia; Total Exploration, Production, Bolivia; Repsol YPF E&P Bolivia; Chaco; Pluspetrol Bolivia; Vintage Petroleum Boliviana; BG Bolivia; Andina; and Matpetrol, the statement said.


Bolivia's government expects to reach a "good agreement" with the companies, Bolivian state news service ABI reported.

"We are negotiating and the negotiations are on schedule. The deadline is October 28 and on that day I will announce further information," Villegas said in the story.

The nationalization decree said that by November all oil companies operating in the country must have signed new service suppliers contracts with YPFB. The decree also stipulates all hydrocarbons produced in Bolivia are government property through YPFB.

BG has received draft agreements for service contracts and Brazil's federal energy company Petrobras (NYSE: PBR) has set up three different negotiating committees to discuss the service contracts plus compensation for losing control of refining assets and new conditions for gas exports to Brazil.

"We only will stay in Bolivia if there are conditions for Petrobras to make a return on investment and if there's an atmosphere where contracts are respected," Brazil's presidential chief-of-staff Dilma Rousseff said on Globo television.

Petrobras, which has invested some US$1.5bn in Bolivia since 1996, has interests in production, refining and gas transport in the country. The company is the largest foreign investor in the country.

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