Monday, June 02, 2008

Last elements of ENRON in Bolivia fall to nationalization

The Bolivian government has continued its nationalization of key resource industries - taking full control of a key gas pipeline company, Transredes.

La Paz moved to nationalize Transredes because Ashmore, continued to oppose the government's majority stake in the company.

President Evo Morales says that the government had tried to negotiate with the other shareholders, the Anglo-Dutch oil company Shell and the US based company Ashmore.

Both multi-national interests operated the remnants the ENRON energy company as a way to profit from the devastation the "Enron collapse" caused.

Morales wants to further increase national revenues from its industries and natural resources.

Parts of Bolivia's energy industry were privatized in the 1990s, with foreign companies awarded 50% stakes by previous corrupt Bolivian administrations.

Last month Bolivia's state energy company paid $6.3M for a majority stake in Spanish-owned Andina, one of the country's biggest energy companies which exploits oil and gas fields, and owns a 50% stake in two giant gas fields.

It has also taken over, by state decree, the control of Chaco from British Petroleum and Pan American Energy as they had refused to re-negotiate contracts that extracted resources from Bolivia without providing for re-investment.

Transredes is not the first energy company to have been nationalized, buying back privatized companies has clearly been the main guiding principle of Bolivian government policy and the greatest reason for Bolivia's improved economic management and the rise of national GDP.

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