Morales, Total Americas President Discuss Future
Michael Seaga, French oil company Total's (NYSE: TOT) president of operations in the Americas, spoke with Bolivia's President Evo Morales and vice-president Alvaro Garcia Linera over the weekend about Total's future participation in the country's hydrocarbons sector, Bolivia's state oil company YPFB said in a statement.
Seaga gave "positive indications [the company would] continue doing business in Bolivia and continue working on more ambitious projects," according to the statement.
"We have much more to do and what Total has promised is to continue operating in Bolivia, a commitment that reflects the kind of behavior the government is hoping to see from [oil companies] with the new hydrocarbons policy," YPFB president Jorge Alvarado was quoted as saying.
Total is the third largest oil company in Bolivia with 15.9% of the country's gas reserves and 13% of its oil reserves, but doubts regarding the company's future involvement in Bolivia surfaced after Morales said his socialist administration would renegotiate oil contracts to comply with the new hydrocarbons law.
The hydrocarbons law passed in May last year requires foreign companies to sign new E&P contracts that include a combined tax and royalty rate of 50% on oil and gas production.
Morales, who took office in January, recently announced the nationalization of hydrocarbons will be completed by July 12.
YPFB also offered Total the opportunity to invest in "non-traditional" oil production zones, which include the Beni, Pando, Norte de La Paz, Oruro and Potosi blocks.
In response, Seaga requested additional information from YPFB to "explore new hydrocarbons investment projects," the statement said.
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