BNA. Investment in Bolivia's hydrocarbon sector is set to skyrocket this year with local capital expenditures reaching US$3.03bn, up from US$1.835bn in 2013, according to the CEO of national oil and gas firm YPFB.
YPFB will invest 60% of 2014 Bolivia capex, with private sector players picking up the remaining 40%, said CEO Carlos Villegas at the regional oil and gas conference LatinVE&P in Lima.
This significant increase in capex will drive a projected natural gas production of 64.8Mm3/d, up from 58.2Mm3/d sold in 2013. YPFB expects production to steadily increase to 77.4Mm3/d by 2020.
Approximately 80% of current natural gas production is exported, with Brazil receiving up to 30Mm3/d and Argentina up to 27.7Mm3/d. Villegas expects this dynamic to change through increasing domestic demand.
The rise in national consumption will be driven by natural gas industrialization and new petrochemical projects; power generation; and increases in household, vehicular, and commercial demand.
Currently 13 companies have plans to drill or are drilling on 42 Bolivian exploration areas; four targeting oil, 31 targeting natural gas and condensates, and seven a mix of oil and gas.
YPFB, aided by international consultants, is also studying 25 prospect exploration areas that are expected to yield at least 10 drilling projects, and conducting regional basin studies on 36 areas.
Work continues on YPFB's US$608mn Gran Chaco liquids separation plant, which will come online in December, and a US$146mn LNG project to create a virtual distribution pipeline to remote areas that should be operational in September, according to Villegas.
Construction has begun on an US$863mn ammonia-urea plant in Cochabamba, which will export part of its production when it begins operations in 2015.
Conceptual engineering has been completed for a new petrochemical complex. The complex will use propane and ethane produced at the Gran Chaco plant for a propylene-polypropylene plant and an ethylene-polyethylene plant, respectively, said Villegas.
A tender will be held in the near future for the complex's process design package (PDP) and front end engineering design (FEED) contract, with the detailed engineering and construction tendered immediately afterwards, he added.
The propylene-polypropylene plant is slated to be operational in 2018 and the ethylene-polyethylene plant in 2022, according to Villegas's presentation at the conference.
In related news, Bolivia's cabinet approved a draft bill to authorize the signing of an E&P services contract with Petrobras (NYSE: PBR) for YPFB area Sunchal, the hydrocarbons and energy ministry said in a statement.
The bill will now be sent to the legislative assembly for approval.
In 2011, the companies signed a study agreement for the area spanning 57,000ha in Tarija department. Initial exploration would require US$6mn; and if commerciality is declared, a JV would be established with YPFB holding a majority stake.
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