Repsol YPF to Increase Bolivian LPG Production 50%

Spanish oil company Repsol YPF aims to increase its liquefied petroleum gas (LPG) production in Bolivia by 50% to about 450,000 tons a year (t/y) in the next few years to be sold as fuel for vehicles in Bolivia or exported to Brazil by rail, a Repsol YPF source told BNamericas.

Using LPG as vehicle fuel is illegal in Bolivia, but the government is under pressure to change the law as people use it anyway, Repsol YPF's logistics and wholesale marketing director for Latin America, Juan Antonio Garica Galnares, said on the sidelines of the 16th World LP Gas Forum in Santiago, Chile. "This would be an important source of domestic demand in the near future," he said, adding "otherwise it will be a problem to allocate the new production we see coming on stream in the next 2-3 years." Repsol YPF would only need to build "a couple of tiny plants" or upgrade existing plants to increase production by 150,000t/y, he said, "so it's not a matter of enormous investments in the country."

Another possibility is that the LPG could be exported to Brazil, and for this new LPG logistics infrastructure from Santa Cruz to the Brazilian border at Puerto Suarez would be needed, he said. Repsol YPF could make use of an existing rail connection between Santa Cruz and Puerto Suarez. "The idea would be to develop that corridor to enter into the Mato Grosso and Sur de Mato Grosso states and to meet this demand with the Bolivian surplus," he said. Brazil imports about 1.5 million tons of LPG annually, most of which is shipped by boat and then transported inland by truck, "so there is a possibility to substitute those imports with Bolivian imports, which would be cheaper," Garcia said.

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