Bolivia: Gas transnational forced to sell out to state

Evo Morales made a statement today from the city of Santa Cruz, the capital of the fascist opposition to this regime, announcing the nationalization of Transredes, the gas transport monopoly owned jointly by Anglo-Dutch energy giant Royal Dutch Shell and Ashmore Energy International, a US firm.

Morales, who appeared in photos flanked by Bolivian military officers, gave a nationally televised address and accused the transnational of plotting with the Santa Cruz-based opposition against his regime. “We do not accept authorities or managers, or any firm that conspires against democracy or against the national government,” he said.

The Bolivian Minister of Hydrocarbons, Carlos Villegas, spoke in greater detail of the charges levied against Transredes, charging the transnational with having frustrated the government’s plan to expand the Villamontes-Tarija gas pipeline and working with the oppositionist anti-Morales government in the province of Tarija to make a separate deal for the same project.

The takeover of Transredes was part of the same “nationalization” decree that Morales read on May 1, 2006. He had originally proposed a purchase of 2.6% of the company, which would have made the Bolivian state the majority stockholder in what what was to have been a jointly owned enterprise with Transredes. After Transredes repeatedly frustrated attempts to reduce it to a minority partner, and its open intrigues against his regime, Morales opted for a forcible purchase the company’s entire stock — roughly 50 percent, the remainder already being in the hands of the Bolivian state.

Transredes has been a sore spot in Bolivian politics since the middle of the 1990s, when then-president Gonzalo Sanches de Losada gifted 40 percent of Bolivia’s gas distribution network to the company, which was then owned by the notorious Enron, with the understanding that it would finance a gas pipeline into Brazil — which it never did. Calls for the Bolivian state to take back the company’s shares, which were transferred to Shell and Ashmore after Enron’s collapse, have been part of Bolivian politics for the past three presidential administrations.

Morales and Villegas both went out of their way to make personal guarantees to foreign investors that their capital will be respected by the Bolivian state. With Morales, the emphasis was on the need for transnationals to remain outside of the Bolivian political conflict. Villegas, for his part, guaranteed state protection of investments in upcoming plans to expand the gas industry, citing in particular the Carrasco-Cochabamba oil pipeline and new refining facilities that are currently in the design phase.

But energy analysts have questioned whether the Bolivian state oil company has the technical expertise or capital to handle its newly increased role in the country’s distribution system. And though officials of Transredes made no comment on the decision, a leader of Bolivia’s right-wing bourgeois opposition party, Poder Democrático y Social, warned that the measure “increases uncertainty and doubt with respect to the current legal protections” and predicted that investors will be less confident to invest their capital in Bolivia.

In the past month, the Morales government signed agreements to make the Bolivian state majority stockholders in two petroleum companies, Repsol-YPF and Pan American Energy. These were similar to the attempts which Transredes rejected. Another business firm that is susceptible to a forced buyout, according to Econoticiasbolivia, is the warehousing giant CLHB, jointly owned by Peruvian and German investors. The government is expected to make its decision on these companies in the days to come.

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