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27 October 2003
Repsol YPF, Syntroleum and Ivanhoe Energy have signed an agreement to carry out a pre-feasibility study on the execution of a project regarding gas to liquid production (GTL) in Bolivia.
The agreement provides for financial and technical studies to be undertaken with a view to analyzing the viability of the installation of a GTL plant in the city of Tarija. It is estimated that the study will take six months to complete and will cost the investor companies around $1 million.
If all findings are positive, the parties will initiate negotiations to draw up a joint venture contract for the construction of a $3 million plant, which will produce 150,000 fuel barrels, of which 90,000 would be exclusively diesel and naphtha. Additionally, 60,000 barrels of other natural gas derivatives would be produced, and a petrochemical urea and raw material plant would be constructed for agro-industrial activities.
Hydrocarbons Minister Jorge Berindoague has referred to the installation of the plant as a "national priority" and has indicated that a new set of regulations, rather than modifications to the existing Hydrocarbons Law, is likely.
The project is set to reap many benefits for Bolivia, not least an annual income of $500 million and an increase in the production of diesel, which would mean an end to dependency on imported diesel, plus increased availability for the domestic market and future exportation opportunities.
For further information on this topic please contact Riccardo Indacochea or Lorena Otero or Iver von Borries at Indacochea & Asociados, Abogados by telephone (+591 3 535 356) or by fax (+591 3 581 200) or by email (firstname.lastname@example.org or email@example.com or firstname.lastname@example.org).
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Ricardo Indacochea San Martin