Bolivian Brazilian Gas pipeline

Active

Prospective

In 1993, the Brazilian oil and gas company Petrobras, signed a natural gas sales agreement (GSA) with Yacimientos Petroliferos Fiscales Bolivianos (YFPB) which requires the construction of a 1,950 mile (3138km) natural gas pipeline from Santa Cruz in Bolivia through Sao Paulo to Porto Alegre in Brazil. The total cost of the project is estimated at US$ 2,200 million. The governments of Boliva and Brazil are public sponsors for the 20-year take-or-pay contract for phased construction of the line. The Brazilian side of the project is 60% owned by Petrobras and 20% by the consortium BTB which includes BHP, Tenneco Gas, British Gas, and several Brazilian investors. The remaining 20% of the project is owned by a Bolivian consortium in which YPFB owns 60% (or 12% of the Brazilian part of the project) and Enron Corp. owns the remaining 40% (or 8% of the Brazilian part). As of 2005, Petrobras' subsidiary Gaspetro (51%), BHP (29%) and Transredes controlled the majority of TBG. On the Bolivian side of the project, 51% is owned by YPFB and 30% belonged to Enron Corp. The remaining 15% was owned by Petrobras (11.25% of the Bolivian part of the project) and the BTB consortium (3.75% of the Bolivian part). Sociedade Privada de Gas (SPG) is the private company representing the partners in the Bolivian-Brazilian gas pipeline. Petrobras is responsible for overseeing and financing the lion's share of the project on a turnkey basis. The contract called for a completion date of 15 December 1998 and Petrobras faced penalties of $100,000 per day if it failed to meet the dateline. In Jun. 2000, BHP sold its shares in the project company to TotalFina and Petrobras for a profit of US$ 42 million. Enron, as of 2005, had a stake of 30% in the Bolivian firm Gas Transboliviano SA (GTB) and and 7% in Transportadora Brasileira Gasoduto Bolivia - Brasil SA (TGB). Enron was in the midst of liquidating its operations and distributing its assets to its creditors. The IADB granted a US$ 240 million loan, while the IBRD provided a US$ 130 million loan, both in the end of 1997. CAF provided two loans to the concessionaire: US$ 215 million in the end of 1997 (US$ 100 million to finance the main pipeline in Brazil, US$ 30 million to finance the construction works in the section between Campinas and Guararema, and US$ 85 million to finance the main pipeline in Bolivia); and US$ 80 million in 1998 (additional funding for the main pipeline in the Brazilian side). Also in 1998, the EIB granted a US$ 60 million loan. The project finally reached financial closure in December 1998 and it started to operate in February 1999. The World Bank's Multilateral Investment Guarantee Agency (MIGA) signed a US$ 14.6 million guarantee contract in 1999 to provide insurance against political risk. In Dec. 2000, the World Bank approved a US$ 180 million credit guarantee for a placement of notes in the US capital markets by the project company (Transportadora Brasileira Gasoduto Bolivia-Brasil SA). This guarantee covers 100% of the amortizing principal repayment. As of December 2007, Ashmore Energy International Controlled Enron's share in the Company. http://www.tbg.com.br/site/cgi/cgilua.exe/sys/start.htm?tpl=home&UserActiveTemplate=tbging http://www.enron.com/corp/pressroom/icoassets.html None

Energy

Bolivia

High

World Bank Group

Project

Natural Gas, Oil and Gas, Government, Residential, Commercial, Manufacturing (Industrial)