The Domino Effect
Are we seeing the domino effect happening now in Central and South America. Influences from the Middle East and CHina are creating hostile atitudes to the last bastion of Freedom in the world, America.
Bolivia Nationalizes Natural Gas Industry
By CHRISTINE HAUSER
Published: May 1, 2006
Bolivia's President Evo Morales decreed the nationalization of the country's natural gas industry today, following through on an election pledge to increase control over the energy industry.
Under the decision, he ordered foreign firms to send production to a state company for sales and industrialization, and said that the state will also recover Bolivian hydrocarbons companies that were privatized in the 1990's, with the state taking over shares that are in the hands of foreign companies and of semi-public Bolivian entities, according to an Associated Press report based on Mr. Morales's speech, which was delivered at the country's San Alberto gas and oil field.
He also ordered the military to occupy the natural gas fields, the A.P. said.
"The time has come, the awaited day, a historic day in which Bolivia retakes absolute control of our natural resources," Mr. Morales said from the facility, which is operated by Petrobras of Brazil in association with Repsol-YPF of Spain, the A.P. said.
The move highlights a regional trend in Latin America of a struggle over who controls energy resources. Protesters in Bolivia have in the past called for the outright expropriation of private gas installations operated by British Gas, Repsol, and Petrobras. Such protests over energy policy have weakened or forced out of power a number of presidents in Bolivia, which has South America's second largest natural gas reserves.
In the past, Mr. Morales has raised concerns in the United States and Europe with his plans to increase government control of the energy industry, and with his pledges to decriminalize the cultivation of coca, the plant used to make cocaine.
Mr. Morales warned that companies that rejected the decree would have to leave Bolivia.
He said all the companies must turn their production over to the state's Yacimientos Petroliferos Fiscales Bolivianos, which was privatized in 1996 and 1997, it reported.
Foreign companies with interests in Bolivia also include British Petroleum, and Total of France. The country likely to be affected the most is Brazil, which is the biggest importer of Bolivian gas, and has a significant investment in Bolivia through Petrobras.
The State Department official said that he did not have a preliminary assessment of the impact the new move would have on United States trade and its relations with Bolivia. The United States gets most of its gas from domestic sources, Canada and Mexico.
The announcement was made on the May 1 national holiday in Bolivia.
"We are trying to get a copy of the proposal and we will discuss it with our Bolivian counterparts and people at the foreign ministry," said a State Department official. "The embassy plans to consult with affected U.S. companies."
A spokesman for BP in London, Robert Wine, said BP has a very small interest in Bolivia as a partner in a joint venture that produces gas equivalent to 15,000 barrels of oil, a small amount compared to BP's 4 million barrels of oil equivalent per day.
Asked how the decision might change BP's interests, Mr. Wine said "We have not seen the detail but I am sure our joint venture partners will be analyzing it. Our partners who are the operators of activities there will be digesting today's news."
The announcement did not come as a surprise.
Mr. Wine noted that there had been political turmoil in Bolivia with public protests over the industry. "The change is not unexpected, but as far as I am aware we were not expecting total nationalization," he said.
Mr. Morales is the country's first indigenous president. Since he was elected in a landslide on Dec. 18, he has emphasized the message that he will lay the groundwork for an economic and political transformation that he says will give voice to the poor, indigenous majority that fueled his campaign.
There have been other measures affecting the sector since Mr. Morales became president.
Last month, moving on a complaint filed by leftist groups, Attorney General Pedro Gareca charged three former presidents and eight former energy ministers with violating the Constitution in signing dozens of contracts with foreign energy companies over the last decade without Congress's approval, Bolivian radio reported, according to Reuters.
The contracts, which included oil companies in Brazil, France and Spain, attracted billions of dollars in investments, but angered groups that accused the firms of plundering Bolivia's resources.
The government is renegotiating contracts that will cost the companies much more in taxes and royalties.
In January, just after he was inaugurated, Mr. Morales appointed Andrés Solíz Rada, a Marxist journalist and former senator, to oversee Bolivia's energy policy.
As president-elect, Mr. Morales met with President Hu Jintao of China in Beijing and called China an "ideological ally," a day after he invited it to develop Bolivia's vast gas reserves.
Bolivia Nationalizes Natural Gas Industry
By CHRISTINE HAUSER
Published: May 1, 2006
Bolivia's President Evo Morales decreed the nationalization of the country's natural gas industry today, following through on an election pledge to increase control over the energy industry.
Under the decision, he ordered foreign firms to send production to a state company for sales and industrialization, and said that the state will also recover Bolivian hydrocarbons companies that were privatized in the 1990's, with the state taking over shares that are in the hands of foreign companies and of semi-public Bolivian entities, according to an Associated Press report based on Mr. Morales's speech, which was delivered at the country's San Alberto gas and oil field.
He also ordered the military to occupy the natural gas fields, the A.P. said.
"The time has come, the awaited day, a historic day in which Bolivia retakes absolute control of our natural resources," Mr. Morales said from the facility, which is operated by Petrobras of Brazil in association with Repsol-YPF of Spain, the A.P. said.
The move highlights a regional trend in Latin America of a struggle over who controls energy resources. Protesters in Bolivia have in the past called for the outright expropriation of private gas installations operated by British Gas, Repsol, and Petrobras. Such protests over energy policy have weakened or forced out of power a number of presidents in Bolivia, which has South America's second largest natural gas reserves.
In the past, Mr. Morales has raised concerns in the United States and Europe with his plans to increase government control of the energy industry, and with his pledges to decriminalize the cultivation of coca, the plant used to make cocaine.
Mr. Morales warned that companies that rejected the decree would have to leave Bolivia.
He said all the companies must turn their production over to the state's Yacimientos Petroliferos Fiscales Bolivianos, which was privatized in 1996 and 1997, it reported.
Foreign companies with interests in Bolivia also include British Petroleum, and Total of France. The country likely to be affected the most is Brazil, which is the biggest importer of Bolivian gas, and has a significant investment in Bolivia through Petrobras.
The State Department official said that he did not have a preliminary assessment of the impact the new move would have on United States trade and its relations with Bolivia. The United States gets most of its gas from domestic sources, Canada and Mexico.
The announcement was made on the May 1 national holiday in Bolivia.
"We are trying to get a copy of the proposal and we will discuss it with our Bolivian counterparts and people at the foreign ministry," said a State Department official. "The embassy plans to consult with affected U.S. companies."
A spokesman for BP in London, Robert Wine, said BP has a very small interest in Bolivia as a partner in a joint venture that produces gas equivalent to 15,000 barrels of oil, a small amount compared to BP's 4 million barrels of oil equivalent per day.
Asked how the decision might change BP's interests, Mr. Wine said "We have not seen the detail but I am sure our joint venture partners will be analyzing it. Our partners who are the operators of activities there will be digesting today's news."
The announcement did not come as a surprise.
Mr. Wine noted that there had been political turmoil in Bolivia with public protests over the industry. "The change is not unexpected, but as far as I am aware we were not expecting total nationalization," he said.
Mr. Morales is the country's first indigenous president. Since he was elected in a landslide on Dec. 18, he has emphasized the message that he will lay the groundwork for an economic and political transformation that he says will give voice to the poor, indigenous majority that fueled his campaign.
There have been other measures affecting the sector since Mr. Morales became president.
Last month, moving on a complaint filed by leftist groups, Attorney General Pedro Gareca charged three former presidents and eight former energy ministers with violating the Constitution in signing dozens of contracts with foreign energy companies over the last decade without Congress's approval, Bolivian radio reported, according to Reuters.
The contracts, which included oil companies in Brazil, France and Spain, attracted billions of dollars in investments, but angered groups that accused the firms of plundering Bolivia's resources.
The government is renegotiating contracts that will cost the companies much more in taxes and royalties.
In January, just after he was inaugurated, Mr. Morales appointed Andrés Solíz Rada, a Marxist journalist and former senator, to oversee Bolivia's energy policy.
As president-elect, Mr. Morales met with President Hu Jintao of China in Beijing and called China an "ideological ally," a day after he invited it to develop Bolivia's vast gas reserves.
