BG plans to invest $500 million in Bolivian Gas fields over the next 5 years

BG in Bolivia:

BG plc demerged from British Gas in 1997 and is in charge of exploration and production and the overseas operations of British Gas. The company entered Bolivia in 1998 and announced the discovery of Margarita field. Currently, BG Group has interests in six exploration and exploitation licenses in Bolivia, including an interest in two gas condensate fields, Margarita and Itau. Gas and liquids are delivered to Yacimientos Petrolíferos Fiscales Bolivianos (YPFB), Bolivian State Energy company to supply Brazilian, Argentine and domestic markets.

Source: BG

Bolivia - Exploration and Production:

Bolivia nationalized its oil and gas industry in 2006 and the country is currently planning to increase its O&G production by allowing international partners to meet export commitments with neighboring Argentina and Brazil.

“Over $1.8 billion will be invested in natural gas exploration this year, more than doubling the amount spent last year. Two-thirds of that will come from YPFB, with private companies putting up the rest”, Villegas, President of YPFB said.

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Bolivia has been successful in bringing a number of multinational partners on board. While there are concerns over the legal protection afforded to foreign investors, BG Group, Total, Gazprom and a number of firms are comfortable with the risk.

Significant Transactions of BG in the year 2010:

Source: Derrick Petroleum E&P Transactions Database

Major E&P companies showing interest in Bolivia:

"Repsol YPF SA, BG Group Plc and Pan American Energy LLC will jointly invest $1.3 billion in the Margarita and Huacaya fields by 2014", YPFB, said in an e-mailed statement. "YPFB, Repsol, Petrobras and Total will invest $750 million dollars in the San Alberto and San Antonio gas fields", according to a separate statement.

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The investments in Margarita and Huacaya will increase the fields’ gas production to 14 million cubic meters in 2014 from a current 2 million. Output at San Alberto and San Antonio will increase by 5 million cubic meters per day, adding to an average 25 million now.

Source Documents:

BG - 2011 Strategy Presentation

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