• Categories
  • Archives

Bolivia Pays Brazil for Oil Plants and Fines It for More than Buyback Price

Petrobras property occupied by the Bolivian military Bolivia took control Tuesday, June 26, of two refineries it bought back from Brazil's Petrobras following a long dispute over the final price and insurance policy reported the Bolivian news agency. Last June 11 the Bolivian government handed the first US$ 56 million check, of a total US$ 112 million, but refused to continue the operation until Petrobras paid for the insurance policies of both plants in Cochabamba and Santa Cruz.

The policy for US$ 180 million covers all damage risks to the plant, equipment, inventory as well as any possible damages to third parties or their properties, said Petrobras.

Bolivian Energy Minister Carlos Villegas said the plants have a processing capacity of 40.000 barrels per day which is equivalent to 100% domestic demand for special and premium gasoline plus 70% of diesel.

Petrobras acquired the refineries in 1994 for US$ 104 million when Bolivia was involved in a privatization spree and opening the exploitation of natural resources to foreign capital.

Under current president Evo Morales the policy has reversed 180 degrees and the Bolivian government through its oil company is taking back the refineries and nationalizing gas and oil reserves.

In related news Petrobras said it would not be paying a fine imposed by the Bolivian government for alleged irregularities during past oil exports.

Bolivia's government has started legal proceedings against the company that could result in a fine of up to US$ 239 million, Bolivian newspapers said last week.

"We haven't been notified of the fine yet. We only know about it from the press, and we won't pay it," the Petrobras press official said.

Last year, Bolivia accused Spanish-Argentine energy company Repsol-YPF and Petrobras of illegally exporting hydrocarbons.

According to the newspaper reports, Bolivia accuses Petrobras' refining unit of having exported oil worth about US$ 188 million in 2004 and 2005 without notifying a government anti-drug unit. Under Bolivian anti-drug legislation, oil exports have to be reported to the anti-drug unit in order to ensure they won't end up in the hand of drug traffickers.

However Petrobras alleges the legislation wasn't in effect yet at the time of the supposed irregular exports, Petrobras said.

Patagonia Exploration

The Patagonian province of Santa Cruz and Petrobras signed an agreement for the exploration of two gas basins in the extreme south of Argentina, plus the possibility of further concessions to another foreign company.

The agreement establishes an investment of US$ 400 million in the next seven years and the concession of two further deposits to Panamerican Energy.

Basically it means expanding the current concession in Cerro Dragon, north of Santa Cruz, identified as Koluel Kaike and Piedra Clavada, which Panamerican Energy was awarded from 1992 to 2017.

Since January 2007, oil areas under the Argentine Hydrocarbons bill belong to the provinces and therefore Panamerican Energy requested the provincial government a ten year extension of the license.

Argentina's Hydrocarbons bill states that oil contracts can be extended for ten years "and in this precise case the company is requesting an extension until 2027," said Alessandro Perrone, Santa Cruz Energy Secretary.

According to Perrone Panamerican Energy has also offered to increase royalties an additional 3%. The bill establishes 12% of total production and oil and gas traded must go to provincial coffers.

Panamerican Energy is also interested in off shore exploration in the San Jorge gulf, an area Santa Cruz shares with Chubut province. Last May Chubut agreed with Panamerican Energy to explore in the area to its own "total risk" and if oil or gas is found, the company must associate with the provincial government.

Santa Cruz is looking forward to reach a similar agreement with the company. Apparently the issue will be considered by Santa Cruz province governor Daniel Peralta during his visit to meet with Argentine president Nestor Kirchner in Buenos Aires.

Panamerican Energy proposal was made official last September.

Mercopress

Tags:

  • Show Comments (1)

  • João da Silva

    Bolivia Pays Brazil for Oil Plants and Fines It for More than Buyback Price
    Terrific news. With friends like Evo Morales,we certainly do not need enemies.

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Ads

You May Also Like

Brazil Gets 10 Million New Credit Cards in 3 Months. Total Now: 347 Million.

The Brazilian market of electronic means registered an increase in 10 million credit, debit ...

A Whole Month of Non-Stop Brazilian Caroling

Once again this year, starting on Thanksgiving Day, those all over the word who ...

Brazilian President Visits UK. End of Farm Subsidies in the Agenda.

Brazilian President Luiz Inácio Lula da Silva will be in the United Kingdom between ...

In Brazil the Press Is a Sacred and Untouchable Cow to the Press

A recent edition of Rio’s daily O Globo reprinted a vehement indictment authored by ...

Brazil Is Not Afraid of Inflation and Plans to Further Cut Interest Rates

The Brazilian government set its inflation target for 2011 at 4.5%, seeing no evidence ...

Why Can’t a 16-year-old Sell Her Own Body, Asks Brazilian Alderman

Despite the fact, that Brazil will be hosting the United Nations World Conference, November ...

Brazil Expecting a 10% Drop in Grain Crop

The 2008/09 Brazilian harvest is forecasted to experience a loss of 5 to 10% ...

Brazil’s Lula Postpones to 2010 Decision on US, French or Swedish Fighter Jets

Brazilian President Luiz Inácio Lula da Silva said Monday that his government should decide ...

Brazilian Bank to Give US$ 100,000 Award to Amazon Project with Zero Destruction

Brazil’s Banco da Amazônia is launching the Banco da Amazônia Award for Conscious Entrepreneurship ...

Brazil: Mercosur Toying with Idea of Parliament

At the end of a seminar this week on Mercosur economic relations, the possibility ...