MercoPress. South Atlantic News Agency

Bolivia announces agreed nationalization of BP aviation fuel division

Bolivian President Evo Morales announced the nationalization of the local unit of BP's aviation division on Friday, further tightening state control over the energy industry. At a May Day rally, Morales said he signed a decree to take over Air BP, a division of British oil major BP Plc.

”I want to ask the Bolivian armed forces along with (Bolivian state energy company) YPFB to gain control of Air BP, the multinational that sells jet fuel. With this decree Air BP is now nationalized,“ Morales said in a speech outside the presidential palace in La Paz.

A BP spokesman in London said the company ”had agreed a handover of our operations.“

”We were surprised by today's takeover process. But we will continue to support the handover,“ the spokesman said.

Morales' government plans to compensate Air BP for the nationalization of its Bolivian unit, which supplies jet fuel to 12 airports and airstrips, Bolivian Energy Minister Oscar Coca told reporters.

”The presidential decree calls for an assessment that has to be carried out in 120 days to determine the value,“ said Coca, adding that the supply of fuel to Bolivian and foreign airlines will not be disrupted.

”The company has been in contact with us and has let us know it will proceed with this change... Air BP's shareholders are acting in a coherent manner,” Coca said.

Air BP -- which supplies air fuels and lubricants to airlines worldwide -- employs around 90 people in Bolivia, the BP spokesman said. Coca said none of these workers would lose their jobs.

Since taking office in early 2006, Morales has seized control of energy, mining and telecoms companies previously in the hands of foreign investors. Many of those nationalizations were announced on May 1, known as May Day or International Workers' Day.

“Now the energy production chain is in the hands of the Bolivian government” said Morales during a May Day rally in La Paz's Plaza Murillo. He pledged not to relent until he achieved “power for the people”.