LA PAZ – Spain’s Repsol YPF and partners British Gas and Pan American Energy signed a deal Friday to build a gas-processing plant in southern Bolivia, a project aimed at increasing gas exports to Argentina.
In a statement, Repsol’s Bolivian unit said the plant will be built at the Margarita mega gas field in the Caipipendi block, one of the Andean nation’s most hydrocarbon-rich areas.
The agreement was signed at state energy firm YPFB’s offices in the eastern city of Santa Cruz by Repsol’s top executive in Bolivia, Luis Garcia Sanchez, and representatives of Spain’s Tecnicas Reunidas, which is to build the plant over a period of 20 months in association with local firms.
Construction of the plant and other infrastructure will require an initial investment of $500 million. The goal is to raise production volumes from Margarita and the neighboring Huacaya field from 2 million cubic meters (70.5 million cubic feet) per day to 8 million cmd in 2012.
“The Margarita and Huacaya fields, operated by Repsol, will become (the main source) for the supply of Bolivian gas to Argentina,” the Spanish energy company said in a statement.
The consortium that will develop the Caipipendi block comprises Repsol, the operator with a 37.5 percent stake; BG, with a 37.5 percent share; and Pan American Energy, with 25 percent.
YPFB President Carlos Villegas attended the signing ceremony and thanked the firms for their investment commitment, saying it was a “anxiously” anticipated contract that will give a renewed boost to the country’s energy sector.
Garcia Sanchez said the companies are pleased to partner for Bolivia’s development and stressed that this project will help the country fulfill its commitment to supply gas to Argentina while also meeting the needs of the domestic market.
Future projections are for the plant’s capacity to rise to 14 million cmd by 2014, “which will enable a significant increase” in natural gas production for Bolivia and Argentina, Repsol said.
At the end of March 2010, YPFB and Argentine counterpart Enarsa signed a contract that calls for Bolivian gas exports to rise from a current level of 7 million cmd to 27.7 million cmd to supply a future pipeline linking the two countries. EFE