SOUTH AMERICAN ENERGY DAILY ROUNDUP (March 23, 2009): Bolivia “demands” energy majors must respect investment pledges
South America Energy Markets (SAEM) will begin a daily roundup of the top-five stories affecting energy markets in the region with links. The roundup includes all the major web dailies of South America and other websites that write about the region’s energy markets. I aim to publish SAEM Daily Roundup from Monday through Friday by noon London time.
March 23, 2009
BOLIVIA – FOREIGN INVESTMENT
State-owned energy company interim president, Carlos Villegas, reiterated the government’s get-tough stance on foreign majors that they must invest in upstream projects, according to state-owned news agency ABI. The statement comes after hydrocarbons association CBH said that only four wells were drilled last year, a serious setback to the government’s plans to attract record investments. Villegas said that YPFB will be “intransigent” with energy companies concerning their investment pledges in the country. Despite the get-tough stance, the political and economic situation in Bolivia has not encouraged energy majors to invest in the country.
BOLIVIA-BRAZIL – GAS SUPPLIES
YPFB president Carlos Villegas plans to make a visit to Brazil to find out how much gas Petrobras plans to import from the landlocked this year, reports state-owned news agency ABI (see also South American Energy Daily Roundup, March 20, 2009). Owing to slower economic growth, Brazil has reduced gas imports from Bolivia from 30 to about 20 million cu m/day. “Brazil is purchasing a smaller amount of gas from December from the maximum allowed [in the gas-purchase agreement], or 31 million cu m/day,” he said. Coupled with lower global energy prices, the 33% plung in gas purchases from Brazil translates into lower royalties and taxes for the government. About 50% of its export revenues derive from gas exports to Brazil and Argentina.
BRAZIL – PRE-SALT CRUST OFFSHORE INVESTMENTS
Mines and energy minister, Edison Lobao, said that the country needs $270 million (€199 million) in the following 10 years to develop the promising reserves in the offshore pre-salt crust area, reports Rio de Janeiro daily O Globo. He said that promising discoveries made in the Santos Basin have turned Brazil into one of the biggest hydrocarbons producers in the world. Lobao said that Petrobras has pledged to invest $111.4 million by 2020, with the rest of the financing coming from foreign oil majors and banks.
BOLIVIA-ARGENTINA – GAS SUPPLIES
Owing to uncertainty over gas exports to Brazil and Argentina, YPFB interim President Carlos Villegas will pay an official visit to Argentina this week, according to Hidrocarburosbolivia.com. A similar trip is planned this week by the YPFB head to Brazil. While Brazil has reduced gas imports from Bolivia, they have risen to 6 million cu m/day to Argentina. Even though Brazil and Argentina have played down the role of Bolivian gas imports, such energy supplies are vital to both countries.
PERU – UPSTREAM INVESTMENTS
Houston-based BPZ Energy announced that it sill invest up to $100 million (€74 million) to boost output and prove up oil reserves at offshore Lote Z-1, reports Peruvian state-owned news agency Andina. The energy company said that the aim of such investments, which had originally been estimated at $86 million, will help double output to up to 12,000 from 6,000 barrels/day last year as well as certify oil reserves to 50 from 25 million barrels.
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