Petrobras Extends Talks with YPFB, Eyes Investments

Brazil's federal energy company Petrobras has extended for 120 days talks with Bolivia's state oil company YPFB, Petrobras CEO Jose Gabrielli told reporters at a press conference. In addition, Petrobras is looking at investment projects in Bolivia.

"We have several operations in Bolivia and now we have four months to study our options," said Gabrielli, without giving details. Petrobras earlier this month said it would consider extending talks for 120 days beyond the December 10 deadline and mull further investment opportunities in Bolivia.

Bolivia guaranteed return on investments for Petrobras when its congress approved E&P contracts in the country, paving the way for new investments, the CEO said.

Petrobras and YPFB have been discussing conditions of a 20-year gas export agreement for up to 30 million cubic meters per day after Bolivian authorities announced they wanted to increase prices beyond today's US$4/MBTU. The decision to increase prices stems from the Bolivian government's strategy to increase returns from hydrocarbons.

Bolivia's May 1 nationalization of hydrocarbons assets was part of the strategy. At the time, Petrobras announced the cancellation of further investments in the country, including the capacity expansion of the 3,000-kilometer Bolivia-Brazil gas pipeline.

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