Bolivia nationalizes gas industry

[The Last Conformist]

LA PAZ, Bolivia (AP) -- President Evo Morales has decreed he is nationalizing Bolivia's vast natural gas industry, sending soldiers to occupy gas fields and threatening to evict foreign companies unless they give the Andean nation control over the entire chain of production.

The move fulfills an election promise by the leftist president, who has forged close ties with Cuba's Fidel Castro and Venezuela' Hugo Chavez, to increase state control over Bolivia's natural resources, which he says have been "looted" by foreign companies.

Morales on Monday sent soldiers and engineers with Bolivia's state-owned oil company to installations and fields tapped by foreign companies -- including Britain's BG Group PLC and BP PLC, Brazil's Petroleo Brasileiro SA, Spanish-Argentine Repsol YPF SA, France's Total SA and Texas-based Exxon Mobil Corp.

The companies had six months to agree to new contracts or leave Bolivia, he said.

"The time has come, the awaited day, a historic day in which Bolivia retakes absolute control of our natural resources," Morales, Bolivia's first Indian president, said in a speech from the San Alberto field operated by Petrobras in association with Repsol and Total SA.

State television aired footage of soldiers and police standing guard outside some gas installations and petroleum company offices in the eastern city of Santa Cruz, where much of the industry is based.

Vice President Alvaro Garcia Linera said troops were sent to 56 locations nationwide.

"The looting by the foreign companies has ended," Morales declared.

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This latest turn in the Morales saga was, I suppose, expected. Nice touch to send in the army.

One wonders about Mr Morales's concept of "looting", given the 50% royalties the Bolivian gov't receives on the revenue of the foreign oil companies. In fact, it's hard to see how nationalization is gonna bring in more money at all, given that scaring away corporate expertise is likely to slow development of the gas fields.

 

[Zardnaar]

Stirring up anti american ,anti globalisation sentiments in South America diverts attention away from their inept autocratic, fascist, commie, hippie, socialist leaders

 

[The Last Conformist]

Yes, because by placing himself on the barricade as the crusader against the evil capitalistas Morales isn't gonna draw attention to himself at all.

He's a charismatic leader. He thrives on attention.

 

[Bozo Erectus]

Morales: At last, now our gas will stay in the ground where it belongs, and not be made use of by evil foreigners! The Gods are pleased! (shakes rattle)

Supporter: Yes it is true Sir, but now that the white devils have gone and taken their machines, how will the people earn money?

Morales: Money? What is that? Just another tool invented by the foreign devils to enslave us! We dont need their money. If colored beads were good enough for us 1000 years ago, theyre good enough for us today!

Supporter: But the world of today is different, we need money to import medicines, and books, and cars and many other things. Now that we arent selling our gas, what will we sell instead?

Morales: Coca of course!


Excuse the spam, but thats how I picture the cabinet meeting after the seizure of the gas fields. You also noticed the use of the army. If the actions of Morales are completely legal and above board, he wouldnt need to use the threat of violence to transfer ownership.

 

[The Last Conformist]

Maybe luiz knows better, but I'm inclined to think he just sent in the army for dramatic effect.

 

[Dreadnought]

Sounds communist

 

[Bozo Erectus]

but I'm inclined to think he just sent in the army for dramatic effect.

Yeah probably it was to show what a decisive, take charge kind of guy he is. I would love to jump ten years into the future to see what sorts of excuses have been made for the damage done by Morales to the already dismal Bolivian economy. No doubt, it'll all be the fault of the US, somehow.

 

[Mise]

Pissing off his biggest customer by kicking out their national gas company probably wasn't the smartest move...

 

[Samson]

Did he not just about say he would do this in his manifesto, or at least his electioneering? Assuming he did I think it would have been morally wrong to anything else.

Whether they can actually run the gas fields is another question. Can it really be that hard?

 

[The Last Conformist]

Did he not just about say he would do this in his manifesto, or at least his electioneering? Assuming he did I think it would have been morally wrong to anything else.

He promised to do this, yes - it even says so in the article.

 

[Mise]

Whether they can actually run the gas fields is another question. Can it really be that hard?

Well the technical infrastructure is in place, so I'm sure they can pump gas in whatever quantities they want, but whether they can run it profitably is another question...

 

[allhailIndia]

India, along with many, many other developing countries has been down this road. Nationalization, as the Bolivians will soon find out, means more money, more power to bureaucrats and the politicians at the expense of the national economy. Using the Army: not a good way to show that u care very much about the rule of law.

 

[Che Guava]

I'll be interesting in seeing how this runs its course. The more 'obvious' outcome is that the gas industry in Bolivia will wither and the underclass that got elected will be left poorer than they were before (which in Bolivia, I've heard, would be quite a feat....)

on the other hand, if his government does stumble apon a system that works for them, we could be seeing some more changes in Latin America...

 

[Ayatollah So]

I must have missed the part where it says companies will be kicked out. What the article actually says, is that if companies pay to play they can stay. That was Chavez's line in Venezuela, and most of the oil companies there decided to stay.

 

[The Last Conformist]

They're not being kicked out, just being forced to become junior partners of the state gas company.

 

[mrtn]

I wonder how many months it will take for USA to realise that there are big hordes of terrorists hiding in the Bolivian oilfields jungle?

 

[JerichoHill]

This is terrible news for Bolivia, just terrible.

 

[Mulholland]

It won't be long now until Morales is approached by China for some bi-lateral wheeling and dealing. He just wanted to sweeten the pot, and with oil prices are the way they are now I don't think he'll have trouble finding a white knight.

 

[Che Guava]

SO maybe in the end, its good news for BOlivia...

 

[AL_DA_GREAT]

Generaly speaking I am not a comunist. I am nearly allways a right wing guy. But here I say Morales is doing the right thing. Bolivian oil money ends up in the wrong hands. It is much better if the goverment could use the money to improve Bolivia's infrastructure.