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MarketWatch: Petrobras, Shell to lose Bolivia gas stations — report

Last Update: 10:49 AM ET May 29, 2006

RIO DE JANEIRO (MarketWatch) — Brazil’s state-run oil firm Petroleo Brasileiro SA (PBR), or Petrobras, Royal Dutch Shell (RDSB.LN), and other private firms within a month will have to turn over their Bolivian gas station network to state-energy firm Yacimientos Petroliferas Fiscales Bolivianos, or YPFB, the Estado newswire said Monday.

Petrobras owns about 25% of Bolivia’s gas stations.

The transfer of the fuel distribution business also hits the companies Copenac, Pisco, Refipet, and Pexim, the newswire said.

The transfer comes in the wake of the nationalization of Bolivia’s oil and natural gas sector that was announced by Bolivian President Evo Morales on May 1. Companies have until June 30 to hand over their gas stations to YPFB.

While Morales is threatening to expel foreign energy firms that have invested more than $3.5 billion in Bolivia since 1996, he is receiving increasing support from Venezuelan President Hugo Chavez.

Chavez Friday in Bolivia signed far-reaching economic cooperation deals in – among others – the mining and energy sector.

Venezuela’s oil minister, Rafael Ramirez, has confirmed Friday Venezuela’s plans to invest $500 million in the short term for two natural gas processing plants, and up to $1.5 billion in the long term into Bolivia’s natural gas industry, according to the AP.

Venezuela’s state-oil firm Petroleos de Venezuela SA (PVZ.YY), or PDVSA, will help run 35 Bolivian state-owned gas stations in a venture to be called Petroandina.

Petrobras is inclined to give up its Bolivian gas stations, Estado said.

Bolivia has earlier said that it also wants Petrobras to hand over its two refineries in Bolivia to YPFB. Morales angered the Brazilian government, when he said earlier this month he saw no need to compensate foreign oil firms for possible asset losses in the wake of Bolivia’s oil and gas nationalization.

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