MercoPress. South Atlantic News Agency

Colombian company signs partnership with Bolivia's YPFB

Signing the documents were YPFB's president Armin Dorgathen and Canacol's representative in Bolivia Luis Alberto Pérez

Bolivia's state-run oil company signed Tuesday a series of agreements with Colombia's Canacol representing an investment of up to US$ 270 million for hydrocarbon exploration and exploitation undertakings in the Ovai, Florida Este, Arenales, and Tita-Techi areas, all of them in the department of Santa Cruz.

Signing the documents were YPFB's president Armin Dorgathen and Canacol's representative in Bolivia Luis Alberto Pérez. The initial investment amounts to US$ 30 million, which could exceed US$ 270 million in case of successful developments, it was explained. Bolivia's gas output has dwindled over the past few years. New investments are needed to reverse that situation.

Canacol is “a new company that is betting on Bolivia,” which “will allow us to increase gas and condensate production,” Dorgathen argued. “The initial investment we are talking about for these four projects is US$ 30 million and if they are successful we will have more than US$ 270 million; we have to diversify the risk,” he added. The new company in Bolivia will carry out exploration activities at its own risk, as well as the execution of oil development and production operations in four new contract areas. After the signing of the contracts, the nod from Bolivia's Parliament is required to go ahead.

With the new partnership, Bolivia's gas reserves are projected to increase by around 390.7 trillion cubic feet of gas (BCF). The revenues generated by the Petroleum Services Contracts will amount to around US$ 1.4666 billion in oil revenues benefitting municipalities, public universities, the National Treasury (TGN), and YPFB.

Canacol is one of the largest independent producers of natural gas in Colombia and its entry into Bolivia would contribute to increasing production and hydrocarbon reserves while YPFB continues with its reactivation plan.