Brazilian President Luiz Inácio Lula da Silva has scheduled a meeting this Tuesday, May 2, to discuss the nationalization decree by the president of Bolivia, Evo Morales, which places control of that country’s oil and gas reserves in the hands of its own state-run company, Yacimientos Petroliferos Fiscales Bolivianos (YPFB).
Under the terms of the decree, foreign companies, such as Brazil’s Petrobras, have 180 days to comply with the new rules.
Petrobras has been operating in Bolivia since 1995. At the moment, it accounts for around 20% of total foreign investments in Bolivia and its tax revenues 18% of the country’s GDP.
Between 1997 and 2000, Petrobras built the Bolivia-Brazil gas pipeline, which can transport up to 30 million cubic meters of natural gas per day. The pipeline runs for over 3,100 kilometers, almost 2,600 in Brazil.
It begins in Santa Cruz de la Sierra, Bolivia, crosses parts of the states of Mato Grosso do Sul, São Paulo, Paraná, Santa Catarina and Rio Grande do Sul.
It passes through the cities of São Paulo, Curitiba and Porto Alegre. The area it serves is where over 70% of electricity consumption, 80% of industrial output and 75% of GDP is concentrated in Brazil.
The minister of Mines and Energy, Silas Rondeau, the president of Petrobras, José Sérgio Gabrielli and the acting minister of Foreign Relations, Samuel Pinheiro Guimarães, will attend the meeting with Lula.