MercoPress. South Atlantic News Agency

ENAP will remain in government hands

Chile's oil company Empresa Nacional del Petróleo, ENAP will remain in government hands and plans to invest in the next tour years, 1,35 billion US dollars, 55% of which overseas.

The announcement follows a meeting in Santiago between the company's hierarchy, Energy Department officials and union leaders where a strategic long term program, was considered and finally approved.

This puts an end to the on going debate in the Chilean government as to the possible privatization of ENAP, given

its dwindling resources, mainly in the Magallanes region. The long term program envisages ENAP's growing presence overseas in oil exploration and exploitation joint ventures; a considerable increase in the company's value; a 700 million US dollars surplus in the next four years and a consolidation of ENAP as the main wholesale supplier of fuel retailers, once the Chilean energy market becomes completely free and open. ENAP currently manages 85% of the wholesale fuel market in Chile.

Regarding overseas expansion ENAP plans a more active participation in the development of Argentina's austral basin and gas deposits, in combination with Magallanes refining capacity that supplies a third of Chile's liquid gas demand.

"It is quiet clear that ENAP in the coming years will undergo a "quality jump", meaning we intend to grow 50% in four years. We have also agreed with the union that if investing in Egypt, for example, is preferable to investing in Magallanes, Egypt will have priority", underlined Mr. Daneil Fernández, ENAP's CEO.

The decision not to privatize ENAP comes as a relief to Magallanes Region where the company is one of the main employers, besides the fact that ENAP employees are among the best paid in Chilean bureaucracy