Negotiating contracts with the Bolivian government

Press Release 02/05/2006 07:00
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Repsol YPF is waiting for further details regarding the terms and conditions of the measures announced by the Bolivian government, including the opening of a 180-day period for the renegotiating of contracts held with the oil companies that are operating in that country.

Following the initial publication of the information with respect to Decree 28,701 of 1 May 2006, Repsol YPFs legal department is closely studying all the implications relating to legal security and guarantees for the investments and the continuity of the companys activities before making any decision in this respect.

Repsol YPF will consider all the actions at its disposal to protect its assets and preserve the employment of all those who work directly and indirectly in Bolivia.

On a first impression, the company views the decree made public yesterday to nationalise hydrocarbons with concern, although in view of the vagueness of the terms in which it is expressed, will not make a definite evaluation until its scope and consequences are fully known.

Repsol YPF Executive Chairman Antonio Brufau said from Argentina that although he considers the nationalisation decree to sidestep all industrial logic that ought to govern relations between a government and companies, he believes that there is still time for an agreement to be reached, and I hope that in these 180 days we will all be capable of applying our talent and intellect, both one party and the other.

Brufau added that, Bolivia should not remain apart from the international political system, and in the current situation, it is imperative to study the Decree in depth, analysing its consequences in detail and taking advantage of the 180 days time limit set by the government to reach agreements of economic rationale for both parties.