President Evo Morales said Bolivia would respond in the coming hours to a proposal from Brazil's state-run oil company, Petrobras, regarding compensation for its two refineries in Bolivia recently nationalized.
Bolivia and Petrobras are in a dispute over how much should be paid to the oil company for its two refineries, which supply Bolivia with most of its gasoline and other fuels. Petrobras, Bolivia's biggest foreign investor warned on Monday it would not invest in Bolivia unless the Morales administration agreed to pay an acceptable price for the refineries. Petrobras said it made a final offer regarding the refineries on Monday and gave the Bolivian government a three-day deadline for a reply, but the terms of the offer were not made public. "Brazil's proposal is being considered and in the coming hours the hydrocarbons minister will respond so the dialogue can continue" Morales said in a news conference. Bolivia wants to pay book value for the plants and Petrobras is demanding "near market prices" according to Petrobras officials. Bolivia nationalized its large natural gas fields a year ago, forcing foreign companies like Petrobras to pay higher taxes and to become service providers to Bolivia's state oil company Yacimientos Petrolíferos Fiscales Bolivianos, or YPFB. "We have the responsibility to recover not only our natural resources, but also what belonged to us before. Due to bad negotiations, bad handling by previous governments, the refineries were given over to Petrobras. Now we are betting on recovering those refineries through dialogue" insisted Morales. Since nationalization Bolivia also forced Argentina and Brazil to begin paying higher prices for the natural gas they buy from Bolivia. Half of Brazil's natural gas needs are met by imports from Bolivia. In addition, Bolivia on Sunday issued a decree giving YPFB control over the marketing and export of crude oil and gasoline from the Petrobras refineries. Brazil said it was disappointed with the decree and that it complicated the negotiations over the refineries.