By Javier Aliaga
LA PAZ – An analyst’s revelations about a purported two-thirds drop in Bolivia’s proven natural gas reserves have rattled the country’s hydrocarbons sector, with the government yet to confirm or deny the information and the foreign energy companies refusing comment.
“It’s a blow to the expectations that have been built up since the start of the decade concerning ... (factors) that gave Bolivia an economic advantage in the regional context,” energy sector analyst Hugo del Granado told Efe in an interview Friday.
Del Granado caused a stir days ago when he published an article about a preliminary yet reliable report he had seen concerning a sharp drop in proven gas reserves, noting the government has been keeping the information secret since June.
According to the analyst, a recent audit commissioned by the government and conducted by U.S.-based consulting firm Ryder Scott shows that Bolivia has only 8.3 trillion cubic feet of proven gas reserves, sharply lower than the range of 12.8 trillion to 26.7 trillion that has appeared in contradictory official versions.
Bolivia is “resisting the truth” because acknowledging the reality would mean losing its status as the second-leading natural gas power in South America, Del Granado said, adding that the country currently ranks fourth in the region in terms of proven reserves.
Venezuela has 200 trillion cubic feet of gas reserves, followed by Argentina, with 13.2 trillion; Brazil, 12.7 trillion; Peru, 11.2 trillion cubic feet; and Colombia, 4.4 trillion, according to figures cited by the expert.
The country’s former superintendent of oil and gas, Carlos Miranda, told the media that, if the drop in reserves is officially confirmed, Bolivia would be faced with “the nation’s biggest-ever natural resources disaster.”
The Hydrocarbons Ministry has not confirmed or denied Del Granado’s information, but it said authorities are conducting an “exhaustive review” of the Ryder Scott report.
The ministry said in justifying the country’s fluctuating reserve figures that the previous consulting firm, DeGolyer & MacNaughton, had “magically” inflated the data when the sector was dominated by private companies, before later reducing them after President Evo Morales’ government asserted state control over the sector in 2006.
Bolivia broke its contract with DeGolyer and MacNaughton after the firm reported that year that, due to a change in its methodology, the country’s proven reserves had fallen from 26.7 trillion cubic feet to 12.8 trillion, without providing a detailed explanation for the decline.
The country’s current annual output of natural gas is 500 billion cubic feet, which supplies both the domestic market and Bolivia’s neighbors Brazil and Argentina.
The Bolivian Hydrocarbons Chamber, which comprises companies such as Spain’s Repsol-YPF, Brazil’s Petrobras, France’s Total and Britain’s BG Group, has said it will not comment on unofficial information and that the only complete study on Bolivia’s reserves dates back to 2005 and puts the total at 26.7 trillion cubic feet.
However, Del Granado’s revelations have sparked concern in the natural gas sector that Bolivian state energy firm YPFB may not fulfill its contracts with Brazil and Argentina.
Bolivia has never suspended gas shipments to Brazil for any length of time, but it has reduced shipments to Argentina on several occasions and Del Granado said that situation could be repeated if the drop in reserves is officially confirmed.
But rather than acknowledging any risk of non-compliance, Hydrocarbons Minister Fernando Vincenti has said repeatedly in recent weeks that Bolivia will fully comply with its contacts and he recently traveled to Uruguay and Paraguay to negotiate new natural gas contracts.
Concerns about Bolivia’s natural gas reserves come amid a virtual freeze on new investments in exploration by foreign companies.
Under a 2006 nationalization program carried out by Morales’ socialist government, foreign natural gas companies were forced to pay sharply higher taxes and royalties and convert their operations into minority partnerships with YPFB or leave the country.
They now say they need new conditions to invest in exploration, noting that there is a single exploratory natural gas well in Bolivia, compared with 61 in Colombia, 300 in Brazil and 600 in Argentina.
“Those are the differences and the data that the government should take into account in reflecting on its policies,” Del Granado said. EFE