El Dia published on December 8, 2011 information about the Bolivian supply of natural gas being insufficient for projects like El Mutun (iron):
[You can see the total supply in the colored ‘waves’, representing the gas fields. The line on top of all is the total demand and the down pointing red arrows represents the deficit. The orangish line at the bottom is the internal market; next is the dark green line for Argentina contract; the red line is the Brazilian contract.]
Energy analyst Alvaro Rios conducted a study which shows the decline in production from gas fields. In the next five to seven years, if the Mutún project were to develop, there would not be the energy that requires; the intended volumes for that purpose now are exported to the Argentina.[that happened because current government signed a contract with Argentina without considering one of the most visible and important plans under its economic policy; if Bolivia would fail to sell contract volumes, would have to reimburse Argentina the gas import cost from elsewhere; a real bad contract and also pushes back El Mutun, which was supposed to bring development to the region and important revenues for Bolivia; under this scenario, Bolivia looses big time, this government is just in the middle but is the guilty party]
“There is no gas for Jindal, at least for the next five to seven years.” It is impossible that under current investments and discoveries that you can count with the required supply, about ten million cubic meters are needed, said the expert and also former Minister of Hydrocarbons during the Government of Carlos Mesa.
He indicated that there are heavy investments to develop fields of Margarita, Itau and Aquío who will be going to counter balance the decline in the fields of San Antonio and San Alberto, which were discovered in 1997 and 1998, and to fulfill the contracts signed with Brazil and Argentina.
He pointed out that production will rise from 43 million cubic meters (MMmcd) to about 67 MMmcd by 2016 and 2017, approximately. These volumes are entirely committed to the internal market. The Rio Grande and Gran Chaco plants extract liquids, and there is no scenario to deliver gas on the scale needed by Jindal.
Rios said that exploration projects still have not found gas; when they discover and gas becomes commercial; the reserve can be developed. Only then a contract can be signed, incoming exploration that could come is not sufficient for YPFB to sign a supply contract, he said.
According to Rios, Jindal is using the large reserves of iron under its contract, and while this agreement remains in force “at least it serves for them to keep stock value in the market places and for their resources strategy; it serves for their purpose and they may be spending a few dollars per year on the reserves, expecting for gas to come, but at the moment it is doubtful that Jindal dares to bring $2 billion for investment,” he stressed.
He remarked that when the company entered the country there was the contract with Argentina. “This contract pay better prices than Jindal in the Mutún”, said the analyst.
In other words El Mutun will have to wait; in the meantime Jindal wins in the stock market, and Bolivia as a country will continue to import gasoline, diesel and no steel industry and no new jobs over the medium run. Yet, the government prefers to gather its fans and advocates for a useless meeting, rather than tackling important issues like this one.
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