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Morales nationalises oil company ahead of referendum

Latest update : 2009-01-25

On Friday, just two days before a referendum on a new constitution championed by his majority, Bolivia's president, Evo Morales, nationalised the oil firm Chaco, managed by Anglo-Argentine company Panamerican Energy.

AFP - Bolivia's President Evo Morales on Friday nationalised the Chaco oil company, managed by Anglo-Argentine Panamerican Energy.

"Little by little, we are taking back our companies," Morales said in Chaco's offices in the central town of Entre Rios, after signing the nationalization decree.

The left-wing president has had his government take over several companies in Bolivia's important gas and oil industry, as well as others in telecoms and mining, since taking power in 2005.

The nationalisation of Chaco took place just two days before a referendum on a new constitution Morales has championed.

If passed, as expected, the revised basic law would define Bolivia as a socialist state and give far greater powers, land and revenue to the indigenous majority from which he hails.

Morales, who went to the Chaco offices with a unit of soldiers, charged that "oil companies are not respecting Bolivian standards", and said that his government "will respect private investment as long as they respect Bolivian norms".

"We want partners, not bosses," he said.

The nationalisation decision raises state-run Yacimientos Petroliferos Fiscales Bolivianos's stake in Chaco oil from 49% to 99%, with 1% still in private investors' hands.

Panamerican Energy said on its Web site that it mainly conducts oil prospection in southeastern Bolivia, where the country's richest gas deposits are found.

Chaco's absorption by YPFB began in May 2008 when it gained control of half the foreign company's stock in negotiations.

The move consolidated Morales's hold on Bolivia's gas and oil reserves, which began in May 2006 with the nationalisation of 12 oil and gas companies in the area.

A year later, Morales nationalised a foreign telephone company and four other oil companies, including 49% of Chaco.

Since May 2006, Bolivia has received a flood of revenue that reached 1.7 billion dollars in 2007 and an estimated 2.5 billion in 2008.

An admirer of Cuba's Fidel Castro and ally to Venezuelan President Hugo Chavez, Morales, elected in December 2005, has also pushed a plan to redistribute wealth to the country's poor indigenous people.

Date created : 2009-01-24

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