PRESS RELEASE

Memorandum of Understanding on Hydrocarbons between Bolivia and Paraguay

By
Wednesday, November 7, 2018

This Wednesday in the city of La Paz, the Ministry of Hydrocarbons, Luis Alberto Sánchez Fernández, and the Minister of Public Works and Communications of the Republic of Paraguay, Arnoldo Wiens Duerksen, signed the "Memorandum of Understanding of Inter-institutional Cooperation for Exchange in Matter of Hydrocarbons ", which contemplates the opening of negotiations between both nations in different areas of the hydrocarbons sector.

"We have worked with presidents Mario Abdo Benítez and Evo Morales on an energy integration line, and from that we can sign a Memorandum with very important points today." There are possibilities to build a pipeline by YPFB either through Puerto Suárez or from Villamontes to the Paraguayan Chaco and to be suppliers of natural gas in the medium term, which would create a new market for Bolivian gas.In the short term we see that there is a possibility to make gas networks in Paraguay and it is possible that, while it is being built, we can supply a liquefied natural gas (LNG) to Paraguay by setting up a regasification plant, as well as the formation of a partnership between Petropar and YPFB for the sale of liquefied petroleum gas (LPG) in Paraguay, on the other hand, a partnership between Petropar, YPFB and other companies to explore hydrocarbon areas on both the Paraguayan and Bolivian side, "Minister Sánchez explained.

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For his part, the Paraguayan minister said: "Both ministries endorse through this document, the intentions expressed by the presidents of Bolivia and Paraguay, who gave a great boost to concretize the integration between both countries in the field of hydrocarbons. signature of this memorandum expresses the intention of our presidents, of our respective State portfolios, to form a team that marks a history, a real integration ", and highlighted the experience that Bolivia has in the matter of exploration and exploitation of hydrocarbons, of the which Paraguay wants to learn

The purpose of the Memorandum of Understanding is to establish the general cooperation framework for the development of studies, information exchange, mutual assistance and transfer of know-how (experience) in the field of hydrocarbons between both countries.

The Memorandum of Understanding was signed within the framework of the Bolivian - Paraguayan will and decision in order to deepen the already existing relations of friendship, through integration and mutual cooperation, and the importance of developing joint activities in the hydrocarbon sector.

"The Paraguayan Minister comes with a very clear idea of ​​strengthening a new pole of development, from today we commit the teams of the ministry and YPFB to continue working and meet soon to present a project in more detail, although now they are intentions, we want to conclude these engineering and reach agreements, partnerships for the good of both countries, "Sanchez reaffirmed.

SCOPE OF THE DOCUMENT

The document establishes 13 points:

1) Develop a feasibility study for the construction of a Bolivia - Paraguay gas pipeline in a first stage, which will cover the demand for natural gas in Paraguay, tending to energy integration within the regional context.

2) Develop a feasibility study for the development of gas network infrastructure in Paraguay.

3) Study the feasibility of establishing a strategic alliance between PETROPAR (or the designated operator / s) and YPFB for the sale of LPG in Paraguay.

4) Study the possibility of establishing a commercial scheme for the sale of recon (reconstituted oil) and white gasoline in Paraguay.

5) Study the possibility of establishing a strategic alliance for exploration in the Chaco - Paranaense Basin.

6) Identify investment opportunities in exploration and / or exploitation activities.

7) Generate and promote strategic synergies between the Parties, to deepen the relations in the matter of hydrocarbons between the Parties.

8) Analyze, evaluate and plan investments in hydrocarbons in the territory of both countries in the regulatory framework applicable to the Parties.

9) Promote the exchange of experiences, information, technology, knowledge and good practices in the field of hydrocarbons for the benefit of the Parties.

This press release from Bolivia's Ministry of Hydrocarbons was published using an automatic translation system.