Andean Group - September 2017 (ISSN 1741-4466)

New petrochemicals plant: On 14 September, President Morales inaugurated a new petrochemical plant in Bulo Bulo town, Cochabamba department, marking the start of a new era of industrialisation of Bolivia’s natural gas production sector. Hydrocarbons Minister Luis Sánchez told reporters that the US$938.3m plant, which was constructed by the South Korean firm Samsung over the last five years – the biggest such project in Bolivia’s history – will be able to produce 1,200 tonnes (t) a day of ammonia and 2,100t a day of granulated urea which is used as fertilizer in agriculture. Construction of the plant generated 3,500 direct and 7,000 indirect jobs and it will now employ 250 workers directly and another 800 indirectly. A government press release notes that of the urea produced, 80%-90% will be exported with Brazil, Argentina, Peru, and Paraguay lined up as potential markets.

Gas deposits: On 2 September, Hydrocarbons Minister Luis Sánchez revealed that a natural gas deposit found at the Madre de Dios basin, located in the north of the country (spanning the departments of La Paz, Pando, and Beni), has potential reserves of 32trn cubic feet (tcf) of natural gas, more than triple the country’s currently certified natural gas reserves of the 10 tcf. In an interview with the state-owned radio station, Patria Nueva, Sánchez said the discovery had been made by French consultancy firm Beicip-Franlab although he underlined that this was just preliminary assessment that will be confirmed by seismic work to be carried out by Bolivia’s state-oil company Yacimientos Petrolíferos Fiscales Bolivianos (YPFB). Sánchez also said that within the next two years, two boreholes will have been drilled. This is in line with the Morales government’s pledge last month to apply two-year hydrocarbon exploration cycles for surface-installed technology, compared with the traditional seven-year or ten-year cycles.

LNG exports: On 3 September, the president of state-oil company YPFB, Oscar Barriga, revealed that between 2013 and July 2017, exports of liquified petroleum gas (LNG) to Paraguay, Peru, and Uruguay totalled US$113.58m. According to Barriga, between 2013 and July 2017, the firm exported 270,825 tonnes (t) of LNG to these three countries, of which Paraguay accounted for 171,517t; Peru, 97.8t; and Uruguay, 1,506t. Barriga told reporters that Bolivia has been selling LNG abroad as a result of two new natural gas liquids separation plants, one which began operating in Río Grande, Santa Cruz department, in 2013, and the other in Yacuiba, Tarija department, in 2015.

New electric train: Work has officially begun on Bolivia’s first electric train network, connecting Cochabamba city in central Bolivia to the surrounding municipal area. President Morales formally inaugurated the project on 17 August. While the initiative once looked in doubt, as the planned start date in 2015 came and went, prospects have improved again, with plans confirmed for the metropolitan train, which will connect the five municipalities of Sipe Sipe, Vinto, Quillacollo, Colcapirhua, and Sacaba to central Cochabamba, with 43 stations spanning three lines. The original estimate for the cost of the project was US$630m. The Bolivian government considered this too high, and the project was suspended until this year, when it was determined that the State could provide the US$448m that more recent estimates have suggested will be sufficient.