MercoPress. South Atlantic News Agency

Guarani Indians threaten to cut natgas to Brazil

Guarani Indians threatened yesterday to take control of Bolivia's largest gas and oil fields, interrupting exports to the gas-hungry Brazil market.

The Guarani told local radio they plan to seize control of the operations of Brazil's state energy firm Petrobras, France's Total and Spain's Repsol YPF in the oil-and-gas-rich Chaco region in eastern Bolivia.

"Today we are going to occupy production fields and we are going to paralyze all oil (and gas) activities and suspend exports to Brazil," Wilson Changaray, head of the Guarani People's Assembly, told Fides radio.

Jorge Boland, trade manager of Transierra ? a Petrobras, Total and Repsol YPF joint venture ? said supplies were normal and played down the risk of disruption. "It is possible (a disruption), but ever since they invaded the control station on August 15, they've been saying this ... but nothing has been disrupted," he told Reuters.

Earlier, Guaraní Indians took over a control station on the Transierra pipeline that transports 60 percent of the gas Bolivia exports to Brazil, its top client. Brazil imports some 26 million cubic metres per day from Bolivia, which is about half of what it consumes. The Indians say Transierra has not fulfilled a promise to invest US$9 million in development projects in the area.

Boland said the new threat came after Transierra formally refused to make a one-off payment of US$9 million for development projects in the area instead of constant regular payments over 20 years as agreed earlier. "Under the deal we invest US$450,000 a year in works ... we do not agree to pay everything at once," Boland said, adding that Transierra was trying to set a meeting with the Indians for today or tomorrow. A meeting last week was cancelled due to security concerns as it was on the Guarani territory, he said.

Changaray said the Indians have decided to step up protests against Transierra because company directors failed to attend a negotiation meeting last Friday.

"We are not asking for an economic handout, but for compensation for all the wealth that they extract from our land and the damage they leave behind," said Changaray. The threat is the latest drawback for Petrobras in Bolivia, which supplies about half of Brazil's booming natural gas consumption. Bolivia sits on the second-largest natural gas reserves in South America after Venezuela.

The leftist government of President Evo Morales nationalized Bolivia's energy sector on May 1, and has since been seeking to raise prices on gas exports to Brazil by as much as 75 percent.