A short interview on hydrocarbons
Latin America Advisor- Energy, January 23-27, 2012 (www.thedialogue.org)
Bolivia’s state-run energy company, YPFB, has said that it expects investment in the country’s oil and gas sector to reach $2 billion in 2012, nearly doubling this year’s record of $1.2 billion. While 64 percent will come from YPFB, the company expects the rest to come from the private sector. Is Bolivia’s push to increase exploration, supply the domestic market and meet its contracts with Brazil and Argentina overly ambitious or does the state have the right plans in place? How important are hydrocarbons for the future of the Bolivian economy? What is the government doing right to promote private sector investment and where is it off the mark?
Francesco Zaratti, La Paz-based energy analyst and former energy advisor to ex-President Carlos Mesa
Six years after the ‘nationalization’ of hydrocarbons, Evo Morales seems anxious to abandon radical discourse and ideology in order to tackle the real problems of the sector, which will continue to be the main pillar of the Bolivian economy.
Investment has grown, but almost entirely in the exploitation and commercialization of gas, with the objective of fulfilling the Argentine market.
There are now greater volumes extracted from gas wells—there will soon be two new separation plants in operation that will supply the domestic market and ects.
The industrialization of gas, one of Evo Morales’ promises, has failed.
On the contrary, subsidized imports of diesel, which the country hardly produces, have grown ($755 million for 2012). It is true that the government would like to fix the situation, but they remain hostage to their ideology, internally divided and constrained by their mistakes.
A litmus test will be a round of presentations by YPFB next month in Houston. There we will see if possible investors have begun to trust the current administration or if they remain skeptical.”