CAF Calls for Gas Concession Bidders

Companies wanting to compete for a long-term concession to distribute gas to 230,000 residential clients in Bolivia should register their interest with the Andean Development Corporation (CAF) from Monday, CAF executive Ignacio Fombona told BNamericas.

The CAF signed agreements with Bolivia's mining and hydrocarbons ministry in June to act as the investment bank for the contract. The CAF is still working with the ministry on designing a mechanism for the tender, Fombona said. Fombona is the deputy director of the CAF's investment banking and financial advisory department, and together with director Peter Vonk is leading the CAF work on the Bolivian project.

There is no deadline for companies to register their interest, he said, adding that the ministry will "probably" make the formal call for bids at the end of this year. The winning company will be responsible for building and operating the network, and initial plans are for a 30-year concession. Estimated investment is US$200mn, Fombona said.

Distributors from Bolivia and elsewhere in the region, as well as gas producers, have already expressed interest to the CAF, Fombona said. "We've had very preliminary conversations with them," he added. To make better use of Bolivia's enormous natural gas reserves, the ministry wants to connect 250,000 residential clients in the next five years.

State hydrocarbons company YPFB already connected 16,500 in the first stage of the project. Although the obligation is to make residential connections, the distributor will have the right to connect commercial and industrial clients, Fombona said.

To register interest, companies should write to Bolivia's mining and hydrocarbons ministry with a brief description of their experience in the sector. The address is as follows: Ministerio de MinerĂ­a y Hidrocarburos Av Mariscal Santa Cruz esquina Ayacicho Edificio Palacio de Comunicaciones Piso 12 Casilla 14377, La Paz-Bolivia.

About Business News Americas: Business News Americas is a multilingual news and business information service that covers the most important original stories in 11 different business sectors throughout Latin America everyday. Visit BNamericas to access our real-time news reports, 7-year archive, Fact File company database, and latest research reports.

Click here for a Free two week trial to our Latin America Oil & Gas information service.