Deadline looms on Bolivia energy

Two companies - France's Total and US-based Vintage petrol company - signed new operating deals on Friday.

The contracts come after President Evo Morales nationalised the oil and gas industry in May to give the state more control and a larger slice of profits.

Bolivia, though poor, is second only to Venezuela in terms of gas reserves.

Under the terms of President Morales' 1 May decree, foreign companies had six months to sign contracts giving up majority control of their Bolivian operations.

Talks were continuing on Saturday with companies including Bolivia's largest natural gas producer, Brazil's Petrobras, as well as Spain's Repsol YPF, and the UK's BG Group.

"There has been significant progress with Repsol, as well as with other companies," minister Juan Ramon Quintana told state media, ABI.

Quoting an unidentified government source, ABI also said the talks with Petrobras were "going well" and that an agreement was expected on Saturday.

Details of the contracts signed on Friday were not immediately available, but the president of Bolivia's state energy firm, Yacimientos Petroliferos Fiscales Bolivianos (YPBF), said they would bring Bolivia $120m (£63m) in annual gas revenues.

'Rocky' negotiations

Talks were dealt a blow in September when Andres Soliz Rada, a main player in the nationalisation process, resigned as energy minister.

Mr Soliz had clashed with state-owned Petrobras, the biggest investor in Bolivia's energy industry.

However, Mr Rada was replaced by Carlos Villegas, and talks have since proved to be more fruitful.

There also were other problems including a lack of money that hampered Bolivia's YPBF, in its plans to buy control of the assets like refineries and pipelines.

YPBF also missed a 1 July deadline to restructure itself so it would be better able to handle its more dominant position in the oil and gas industry.

Source: BBC

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