29-09-04

Bolivian opposition leader Evo Morales called on Spain and Brazil -- two countries with substantial investment in the Andean nation's oil and gas industries -- to understand La Paz's need to implement energy reform rooted in "justice and fairness."

The statements of the chairman of the Movement Toward Socialism, or MAS, came as lawmakers debate a critical hydrocarbons bill. A provision of the bill explicitly says the Bolivian state will "regain" control of extracted natural gas "at the wellhead." That means foreign companies will lose the prerogative of selling as they see fit the gas -- and to a lesser extent, oil -- that they extract.

The government contends the proposed scheme does not amount to expropriation or nationalization, a claim disputed by some of the foreign companies doing business in Bolivia. The bill also includes a new tax that substantially increases the government's share of revenue, and entails revamping existing contracts with the multinationals.

As measured by theirproduction within the Andean nation, the two leading foreign energy firms operating in Bolivia are Spain's Repsol-YPF and the Brazilian state-owned oil giant Petrobras.

Morales told that MAS is developing "an international strategy" to secure a meeting with Spanish Prime Minister Jose Luis Rodriguez Zapatero and Brazilian President Luis Inacio Lula da Silva to ask for their understanding of Bolivia's new energy policy. This strategy, Morales said, depends largely on Venezuelan President Hugo Chavez, who has already endorsed Bolivia's new energy policy. MAS hopes that Chavez can persuade Lula of the need for La Paz's planned changes and that the Brazilian will in turn convince Zapatero.

"There are central, substantive issues we must discuss, especially with Spain, if we're talking about 500 years ago," Morales said with sarcasm.

According to Morales, MAS is not seeking "the expulsion, confiscation or expropriation of the multinationals. We're saying that the contracts must be based on principles of justice and fairness."
Morales, who is also leader of Bolivia's militant coca growers, called on "the international community to respect the sovereign will of the people, who on July 18 asked to regain possession of those resources" in a referendum on national energy policy. The results of the referendum were used to draft the energy bill being debated in Congress.

President Carlos Mesa was obliged to convene the plebiscite to appease the protesters whose demonstrations against the proposed export of natural gas forced his predecessor to step down in October 2003.

Earlier, Petrobras said it will stay in Bolivia, despite the changes to energy policy, but Repsol-YPF has warned it will be "very difficult" to remain in the Andean nation under the anticipated conditions.

Source: EFE