On February 15, a solemn ceremony marking the launch of an LNG plant took place in Rio Grande, Santa -Cruz Department, Bolivia. The new plant, which is expected to produce 210 tonnes of LNG per day, will initially supply gas to 600.000 people within the country, while with gradual gasification of Bolivia’s regions, surplus produce will be exported to Brazil, Peru and Paraguay.
The opening ceremony was attended by Evo Morales, President of the Plurinational State of Bolivia, as well as Luis Alberto Sanchez, the country’s Minister of Hydrocarbons and Energy, and Guillermo Acha, Head of Bolivia’s state oil and gas company Yacimientos Petroliferos Fiscales Bolivianos (YPFB).
In his speech at the opening ceremony, Evo Morales said that the project is one of the results of the “Bolivian people's struggle” for energy independence. The President recalled that there had been an attempt to build an LNG plant in a Chilean port (since Bolivia is landlocked) under a private project in 2003 in order to export Bolivian gas to North America; however, the plan was never carried out due to popular protests.
According to Luis Alberto Sanchez, during the first stage, the LNG project will supply natural gas to approximately 144.000 households in 27 municipalities of Bolivia which have no access to the centralized gas supply system due to remote location of the gas pipelines.
YPFB has announced that the plant of such type is the first one in Bolivia. It will be integrated with a so-called «virtual pipeline» system, composed of cryogenic tanks (16 units), mobile regasification units and regasification stations. At the moment, the enterprise is also equipped with gas storage facilities with a total capacity of 3.000 cubic meters.
As stated by Guillermo Acha of YPFB, the cost of construction of the plant amounted to $205mn for the company. An additional sum of $240mn was invested in developing the pipeline network to connect to the LNG system. The Head of YPFB also noted that the production activity of the plant is expected to generate an income of $300mln until 2025.
In addition, Mr. Acha said that the Bolivian company plans on extending the gas supplies to 33 additional municipalities in the near future, and half of them will begin to receive the fuel next month.
The opening ceremony in Rio Grande was also attended by representatives of Gazprom International, the sole specialized operator of Gazprom's hydrocarbon prospecting, exploration and development projects abroad, which carries out a number of joint projects with YPFB in Bolivia.
Bolivia is divided into 9 departments, 112 provinces and 327 municipalities. The country has a population of about 10.5 million people.
In February 2016, a delegation of representatives of transport organizations and trade unions of Bolivia, headed by Oscar Javier Barriga, the country’s Deputy Minister of Hydrocarbons and Energy, visited Russia. The main objective of the Bolivian specialists' visit was to get acquainted with the Russian LNG and natural gas for vehicles market. The members of the delegation have commended the productive capacities and the technical and scientific expertise of Russian enterprises, expressing willingness to boost cooperation in developing LNG and natural gas for vehicles projects.
Gazprom cooperates with Bolivia’s YPFB on the basis of the Memorandum of Understanding signed in 2007.
Bolivia ranks third among top hydrocarbon producers of South America, producing over 20 billion cubic meters of natural gas per year. At the end of 2013, the proved natural gas reserves were estimated at 297 billion cubic meters, and the proved oil and condensate reserves were at 28 million tonnes.
In the context of a drastic decrease in oil prices, Evo Morales, the country’s President, announced the diversification of Bolivia’s economy, which is mainly based on energy resources exports, as well as the start of a program for industrializing oil and gas sector, which envisages the development of natural gas for vehicles market.