Published Reason . The presidents of Bolivia and Argentina signed an energy agreement for 20 years. Fixed the price of gas at U.S. $ 5 until the end of the year. For 2007 they will devise a formula. Bolivia
secured a new long-term market for gas to Argentina and set a benchmark price of energy in the region, five dollars per million British thermal units (BTU). It is the highest price charged in South America.
The presidents of Bolivia, Evo Morales, and Argentina, Nestor Kirchner yesterday signed a new agreement in Buenos Aires, where, besides changing the price, decided to extend the relationship energy between the two countries for 20 years and expand export volumes of Bolivian natural gas.
"That the price up to five dollars is a benefit and relief for my country," Morales told about 50,000 people, among Bolivians and Argentines gathered at a sports center in the municipality of Buenos Aires Hurlingham, where the agreement was signed .
This agreement is the first step to building the pipeline to northeastern Argentina (GNA) and industrialize the gas in Bolivia, he said Kirchner.
So far, Argentina bought gas at a price of U.S. $ 3.53 per million BTU. Between 15 July and 31 December this year paid U.S. $ 5.
The increase, over 50%, will allow state revenues to rise at USD 70 million until the end of the year, remarked in La Paz Oilfield adviser Fiscales Bolivianos (YPFB), Manuel Morales Olave.
Next year, the price will be determined by a formula set to be completed by representatives of both governments in 30 days. Morales Olave explained that the formula will be tied to the price of liquefied petroleum gas (LPG) and natural gas. He stressed that the U.S. $ 5 are an important reference for the region, apart from serving as a parameter for the negotiations with Brazil.
A Foreign Ministry source said that Argentina, in practice, the agreement represents "a floor price of gas in the region and one of the hardest hit is Brazil, because not only will buy more expensive in Bolivia but Argentina. "
The volume of gas exports to Argentina increased to 27.7 million cubic meters per day (MCF) when built the GNA, in this way, Bolivia will export more than 20 MCF. Meanwhile, the supply will continue at 7.7 MCF.
Future gas export will be dry, liquefiable, for which the Argentine government will loan "concessional or preferential" Bolivia. Thus, YPFB will install a plant for extracting the components capable of producing LPG.
The agreement contains a commitment to allocate Argentina Bolivian gas to domestic demand. You agree that the energy "shall not be used to increase the export authorizations from Argentina to third countries without the agreement of both parties", which may affect sales to Chile, Uruguay and Brazil. Buenos Aires, AFP, ANF and central Writing
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