Page Seven / La Paz
The government approved a decree that seeks to accelerate investments in exploration and exploitation of hydrocarbons in fields run by Yacimientos Petrolifos Fiscales Bolivianos (YPFB), but experts doubt the scope that the measure may have to improve reserves and production.
The approved Supreme Decree 4616 establishes the conditions for the application of incentives to investments in hydrocarbon exploration and exploitation when YPFB is an operator and to prioritize areas with oil production potential.
These incentives were set by the Government in 2012, with Law 767 and its regulatory Decree 2830 of 2016. It was determined to grant oil companies as an incentive 30 dollars in tax credit notes (Nocres) and 10 dollars in cash so that increase oil production.
Now, with Decree 4616, this benefit is ratified for operators who, by updating development or work plans and budget approved by YPFB, commit and execute investments that allow increasing the recovery factor of the fields and counteracting the decline in production. of oil.
However, it has now been determined that when YPFB begins operations in a field returned during the exploitation period, in order to benefit from the incentive of $ 30 in Nocres, it must present the annual operating plan to the National Hydrocarbons Agency (ANH) for approval, in which it commits and executes investments that allow increasing the final recovery factor of the fields and counteracting the decline in oil production.
The decree also establishes an incentive of 30 dollars for the production of oil from new reservoirs discovered in YPFB reserve areas, fields closed and reactivated as a result of investments by the state company in the traditional zone.
The incentive for YPFB rises to $ 35 for production in a non-traditional zone. The resources come from the Fund for the Promotion of Investment in Exploration and Exploitation of Hydrocarbons (Fpieeh), which is fed with resources from the Direct Tax on Hydrocarbons (IDH) contributed by municipalities, governments and other entities.
In the opinion of Hugo del Granado, an analyst of the sector, this new decree does not introduce major changes, it is basically aimed at YPFB and there are no new incentives for private operators to increase production. “What was expected was an agreement with the private operators, evaluating their requirements and incorporating them into the incentives to increase investment and collect these incentives,” he said.
Álvaro Ríos, former Minister of Hydrocarbons, said that the decree should be evaluated in detail, but expressed his confidence that it could help YPFB to carry out new investments to produce gas, oil and condensate.
In his opinion, it is positive that there is concern to improve the production of hydrocarbons in the country and that it is invested. This also depends on the existence of tranquility and no seizure.
The norm and settings
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Provision The decree indicates that gas fields classified as marginal and / or small will contribute annually to the domestic market a volume of natural gas equivalent to 0.5% of their annual production corresponding to the previous year. YPFB must submit until March 31 of each management, to the Ministry of Hydrocarbons and Energies and to the ANH, the annual evaluations of the incentives on investment, production and reserves of the previous management.
