Bolivia to seek changes to hydrocarbons law: new energy minister

Santiago (Platts)--24Jan2006

The Bolivian government plans to modify the country's controversial  
hydrocarbons law, approved by Congress last year, newly appointed minister for
hydrocarbons, Andres Soliz, said Tuesday, according to a statement from the 
government press office.

     Soliz said the law failed to address crucial issues such as the price at 
which multinational companies could fix the purchase and sales of fuels. He 
also said that the role of private companies had to be clarified. The minister
also expressed the need to strengthen the ministry for hydrocarbons, which is
comprised of just 49 employees, 20 of whom earned "starvation wages," he said.

     After a long struggle through Congress, marked by several nationwide
strikes, Bolivia's hydrocarbons law finally was approved last May. Although
the bill sought to raise a 50% charge on the country's oil and gas sector
through a mixture of royalties and taxes, many Bolivians felt the law did not
go far enough in reestablishing national control over the country's energy
reserves.

     Protests forced president Carlos Mesa to step down. During his election
campaign, newly elected president Evo Morales spoke of nationalizing the
country's massive natural gas reserves, but has since tempered his discourse,
indicating that nationalization did not imply expropriating assets belonging
to energy companies active in the country, such as BP and British Gas.

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