Category Archives: Gas

Bolivian Political and Social Landscape: Primer for Pending Presidential Elections

As the presidential campaigns gain momentum, AIN outlines the political and social landscape in Bolivia to provide background to understand upcoming electoral debates.

President Evo Morales is running for a third term in the October 12, 2014 elections.  Critics argue he is not eligible to run for another consecutive term, but the Plurinational Constitutional Tribunal ruled in his favor, and the opposition across the political spectrum lacks a strong, unifying candidate.  Four candidates have formally registered to run against Morales.

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Wright on Bolivian Lithium: Interesting, but Not Quite Right

It’s not the first time a respected, established journalist has presented a selective view of events in Bolivia.  In general, Lawrence Wright’s New Yorker article “Lithium Dreams” covers a great deal of territory, but lacks objectivity and thorough research in some areas.

Some errors are simple and avoidable, such as misspelling Pablo Solón, Bolivian ambassador to the U.N.’s name, or confusing the timeline of key incidents.  Wright claims, “After President George W. Bush placed Bolivia and Venezuela on a blacklist, saying that neither country was doing enough to combat drug trafficking, Morales and Chavez expelled their respective ambassadors.”  Morales actually expelled Ambassador Goldberg and Chávez followed suit on September 11 four days before the U.S. “decertification” of Bolivia’s antinarcotics initiatives.  Both assertions could have been easily verified by fact-checkers.

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Bolivia’s Gas Nationalization: Opportunities and Challenges (4)

Public Participation, Transparency, and Accountability

Under Bolivia’s 1994 Popular Participation Law, Bolivian citizens are able to participate in decision-making regarding public funds, including oil and gas revenues, at the municipal level.  Under this law, the municipalities use a bottom-up participative planning process to determine the use of public funds.  This is part of Bolivia’s decentralization initiative and efforts to move government decisions closer to the people.  Population groups are divided into Organizaciones Teritoriales de Base (OTBs) at basically a neighborhood level.  The groups then propose projects for spending public funds allotted to their area.  These projects are then grouped into an Annual Operating Plan for each municipality.1

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Bolivia’s Gas Nationalization: Opportunity and Challenges

The four memos in this series on Bolivian oil and gas policy and the challenges facing the nation is part of an ongoing project of the Andean Information Network and Erika Weinthal from the Nicholas School of the Environment and Earth Sciences at Duke University examining Bolivia’s efforts to confront the “resource curse.”

Part I: Background on Bolivian Oil and Gas Policy, Current Conflicts, and Challenges
Part II: Political Conflict over Gas and Oil Tax Distribution
Part III.  Increased Gas and Oil Revenues from Nationalization Benefit Various Projects
Part IV.  Accountability and Sustainability

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Bolivia’s Gas Nationalization: Opportunity and Challenges (3)

National Level

At the national level, the government spends oil and gas revenues on a program called the Juancito Pinto Stipend that gives about $25 a year to the families of each child enrolled in primary school.  The program aims to encourage school enrollment and defray school supply costs.  In addition, as mentioned earlier in this series, the Bolivian legislature approved a Morales administration proposal on November 27 to spend 30 percent of the direct hydrocarbons tax (IDH) on a Renta Dignidad payment to Bolivian senior citizens.3   Ongoing negotiations between the Morales administration and departmental prefects may modify this measure.

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Fuelling Bolivia’s crisis?

"Sometimes you get to the front of the queue and the diesel has already run out," says Agapito Serviche from his pick-up truck.

"The diesel does not last long enough for a day's work, so I have to stop working and come back to the queue just to put food on the table."

Blame game

Santa Cruz, which is home to large scale commercial agriculture, has been worst hit by Bolivia's chronic diesel shortages, which coincide with the start of the planting season.

In rural Santa Cruz, tensions are worse.

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Bolivia’s Gas Nationalization: Opportunity and Challenges (2)

On November 27, the Bolivian legislature approved the Renta Dignidad, a monthly pension for Bolivians over age sixty, and the redistribution of the IDH to pay for it.  This move significantly reduced departmental revenues, angering opposition governors.  They interpret the measure as Morales’ attempt by President Morales to stem growing departmental power more than as a way to help the elderly.   Administration officials counter that departments receive a disproportionate share of oil and gas revenues and do not invest them responsibly.

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Bolivia’s Gas Nationalization: Opportunity and Challenges (1)

Bolivia has a long history of an economy largely driven by exports of primary materials, from silver to tin to oil and gas.  Though it has previously experienced various resource boons, the resulting revenues did not help alleviate poverty.  Bolivia has the second largest reserves of natural gas in South America after Venezuela and exports most of its natural gas to Brazil and Argentina.  A little less than 80 percent of the dollar value of Bolivia’s production from the oil and gas industry comes from natural gas, 20 percent from petroleum, and 1 percent from butane and propane.   Natural gas exportation requires long term contracts with purchasers and significant investment in pipeline infrastructure.

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