This is a best prospect industry sector for this country. Includes a market overview and trade data
Last Published: 7/12/2019

Overview

According to the latest international evaluation of potential gas reserves in 2017, Bolivia possesses approximately 12.5 trillion cubic feet (TCF) of natural gas reserves (both proven and probable).  Of this amount, 10.7 TCF are proven reserves.  

Bolivia has more than 240.95 million barrels of proven crude oil reserves.  In addition, the government estimates another 47.8 million barrels of probable reserves and another 78.4 million barrels of possible reserves.

In the hydrocarbons sector, Bolivia currently produces an average of 55.6 million cubic meters of gas per day (mm3/d), using 14.9 mm3/d for domestic consumption, while exporting 22.6 mm3/d to Brazil and 18.2 mm3/d to Argentina.    Hydrocarbons accounted for approximately 34 percent of Bolivia’s exports, or $3.0 billion, in 2018. 

The state hydrocarbons company, Yacimientos Petroliferos Fiscales Bolivianos (YPFB), generally forms joint ventures (55-45 percent sharing, with the state owning the majority share) for a limited period of 40 years with private companies for extraction services.  YPFB also administers a gas sales agreement with Brazil’s state-owned oil company, Petrobras, and another agreement with Argentina.

The Hydrocarbons law (Law 3058, May 2005) and a subsequent Supreme Decree (May 2006) require that companies sell all production to YPFB and that domestic market demand be met before exporting hydrocarbons.  Furthermore, these laws transfer the entire transport and sales chain over to state control.  After the law was enacted, hydrocarbon companies were required to sign new contracts with YPFB, agreeing to pay 50 percent of gross production in taxes and royalties.

Note that for any future investments in this sector, the constitution requires the state to have a majority share.  However, because of the lack of investment in the sector (especially in exploration) and a reduction in the levels of proven reserves, the government has been issuing incentives and exemptions to encourage investment.
 

 

2017

2018

2019 estimated*

Total Local Production

6,136,293

7,173,411

NA

Total Exports

2,633,300

3,042,200

NA

Total Imports

937,400

1,324,600

NA

Imports from the US

50.834

54.674

NA

Total Market Size

4,440393

5,455,811

NA

Exchange Rates

6.86

6.86

NA

*The Bolivian government does not provide estimates.
(total market size = (total local production + imports) - exports)
Units: $ millions
Source: State-owned oil and gas company (Yacimientos Petroliferos Fiscales Bolivianos, YPFB)
 

Leading Sub-Sectors

The best sales prospects in hydrocarbons are natural gas-related machinery, equipment, and production techniques.  Several U.S. companies have been successful selling supporting machinery and equipment to Bolivia.
 

Opportunities

The decline of Bolivia’s proven natural gas reserves may present several investment opportunities for foreign firms since the government needs to demonstrate that it can fulfill current export contracts and meet increasing domestic demand.  Among these opportunities are:

  • Exploration/drilling/production: Exploration and drilling for natural gas has been a stated government priority since 2011.  Exploration is especially important for the government since it is estimated that reserves could be below 10 TCF, which could raise doubts about the capacity of Bolivia to fulfill both current external contracts and satisfy increasing internal demand.  Production is also important to the government since the signing of the October 2006 agreement with Argentina.  Under the agreement, Bolivia agreed to progressively increase gas exports to 27.7 mm3/day by 2021, which may conflict with growing internal demand.  In 2019, Bolivia will be seeking to sign a new natural gas export contract with Brazil, but future export volumes are in question due to doubts regarding Bolivia’s reserves and other possible alternatives for Brazil.   

Web Resources

State Owned Enterprise
Hydrocarbons Regulator
Ministry of Hydrocarbons
Private Chamber of Hydrocarbons

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