SANTA CRUZ, Bolivia – Argentine state-controlled energy company YPF signed an agreement on Wednesday with Bolivian counterpart YPFB to explore an area of eastern Bolivia with potential natural gas reserves totaling 2.7 trillion cubic feet.
YPFB CEO Guillermo Acha and YPF’s vice president for natural gas and energy, Marcos Browne, signed the deal on the second day of a petroleum congress in this eastern Bolivian city.
Acha told reporters that YPF, which has no prior exploration operations in the Andean nation, would become a new participant in Bolivia’s hydrocarbons sector.
The agreement covers the 99,250-hectare (383-sq.-mile) Charagua area, which is located in the eastern province of Santa Cruz and estimated to contain 2.7 trillion feet of natural gas, according to YPFB.
If the exploration work confirms the reserves’ existence, YPFB and the Argentine company will form a joint venture with a view to investing $1.18 billion.
In accordance with Bolivian law, Congress still must give the green light for the Charagua agreement.
Acha also announced that YPFB would sign two other agreements with YPF covering the exploration of the Abapo and Yunchan areas, also located in eastern Bolivia.
Bolivia’s government estimates that its natural gas reserves currently amount to 11 trillion cubic feet, but it says it is conducting an exploration campaign to more than double that total to 23 trillion cubic feet.
Bolivia exports natural gas to two foreign markets: Argentina and Brazil.