LA PAZ – A consortium led by Spain’s Repsol YPF plans to invest $1.5 billion to boost natural-gas production in the Caipipendi block in southern Bolivia, with a view to both meeting domestic demand and exporting the hydrocarbon to Argentina.
Repsol YPF Chairman Antonio Brufau made the announcement on Thursday at a joint press conference with Bolivian President Evo Morales, after the two had met at the presidential palace.
Brufau said the money will go to developing the Margarita and Huacaya fields in southern Bolivia and boosting their combined output from 2 million cubic meters (70.5 million cubic feet) per day at present to 14 million cubic feet per day by 2013.
Repsol sources told Efe that the investment in the block will be made by a consortium in which the Spanish firm has a 37.5 percent operating stake, British Gas holds 37.5 percent and Argentina’s Pan American Energy owns 25 percent.
The consortium will undertake construction of a gas treatment plant and develop the project in two phases. The goal is to produce and transport 8 million cubic meters of natural gas per day by the end of the first phase, in the first quarter of 2012, and 14 million by the end of the second phase, in mid-2013.
Repsol YPF has not ruled out the possibility of increasing production and investment further beyond 2013, since the Caipipendi block in the Tarija and Chuquisaca regions holds proven gas reserves of 3.7 trillion cubic feet and potential reserves of between 10-12 trillion cubic feet.
The Margarita and Huacaya fields that make up the Caipipendi block cover a surface area of 123,000 hectares (474 sq. miles) and include five wells that range in depth from 4,000-6,000 meters (13,115-19,670 feet) and that were drilled between 1998 and 2008, Repsol said.
“The basin is enormously prolific and rich. These proven reserves could climb to 10-12 TCF as we learn more about the characteristics of the subsoil,” Brufau said.
Repsol noted in a statement that the Huacaya field was one of the five largest gas finds made worldwide in 2008.
Brufau said the investment announced Thursday is the product of negotiations between Repsol and Bolivia that took place during Morales’ visit to Spain in September.
The socialist head of state, for his part, thanked Repsol for its plans to invest in the Andean nation and reiterated that his government’s policy is to welcome foreign companies as partners and not “owners of (Bolivia’s) natural resources.”
As long as outside companies accept that partnership role, “foreign investment is always welcome and respected,” Morales said. EFE