Bolivia; Oil Nationalization Leaves Less Gas; YPFB Warns of Energy Crisis; Bolivia Rules Out Measures Affecting the Vulnerable.

Friday, May 1, 2026. Bolivia As we turn our focus this week to Bolivia, we begin with an observation that captures the broader challenge facing the country today, one that was shared with us by Joseph Weiman, a trusted colleague whose perspective we rely on when assessing Bolivia’s evolving risk landscape. Joseph noted that the Paz administration faces a significant task in rebuilding institutional credibility after years under MAS governance, particularly in the context of attracting Western investment. At the center of this effort is not just policy reform, but people, bringing in capable leaders who are both willing and able to navigate entrenched structural challenges, even when progress is slow and resistance is inevitable. This point resonates strongly with the realities we continue to observe on the ground. Investor confidence is not built through messaging alone; it is built through execution, consistency, and the demonstrated ability to overcome institutional friction. The selection of leadership, especially in key sectors, will serve as one of the clearest indicators of whether Bolivia is prepared to move in that direction. We’re grateful to Joseph for framing this so succinctly. His insight reflects exactly the kind of grounded, experience-based perspective we value as we assess risk across the region, and it sets the stage for a deeper look at Bolivia in this week’s report. Brett Mikkelson Founder, B.M. Investigations, Inc. – Private Investigations in Panama TOP NEWS and TIDBITS: After 20 Years, Oil Nationalization in Bolivia Leaves Less Gas and Greater Dependence State revenues during the governments of Evo Morales and Luis Arce (2020–2025) totaled approximately $60 billion, according to Bolivia’s president, Rodrigo Paz, who alleged mismanagement and corruption involving part of those resources, claiming they were not used to strengthen the state oil company. The nationalization of hydrocarbons—symbol of the political cycle initiated by former president Evo Morales in 2006—reaches its twentieth anniversary amid growing criticism in Bolivia due to the decline in gas reserves, investment, and revenues, as well as the limitations of the state-owned YPFB in sector exploration, which has increased dependence on fuel imports. On May 1, 2006, Morales (2006–2019) surprised oil companies by announcing from the San Alberto gas field in southern Bolivia the nationalization through a decree establishing “absolute control” over the sector. The decree forced companies—including Repsol, Petrobras, and TotalEnergies—to hand over production to the State and renegotiate contracts within 180 days or leave the country. The decree included the military occupation of oil fields and plants, as well as the acquisition of majority stakes in strategic companies, increasing the State’s share of gas revenues. Morales presented the measure as the third and final nationalization, following those carried out in 1937 against Standard Oil and in 1969 against Gulf Oil, both American firms. “It was a kind of shock for the sector, the way they came in with a military takeover. It was highly symbolic,” recalled Carlos Delius, former president of the Bolivian Hydrocarbons Chamber, who was a director at the time and later led the institution between 2010 and 2014. “Then came the ‘Héroes del Chaco’ decree, and together with Law 3058 (Hydrocarbons Law, in force since 2005), it sealed the fate of the sector—shifting from a system with modern contracts to one that changed everything and became excessively state-controlled,” he added. The nationalization aimed to increase State revenues, which experienced a boom period, with annual peaks exceeding $5 billion in 2013 and 2014, before the decline began. According to Delius, the measure slowed new investments, as companies chose to remain due to already committed capital in wells and plants. However, faced with reduced revenues, they focused on recovering investments rather than taking risks, losing interest in exploration. “The success of nationalization—capturing revenue—ultimately became its own poison. It was unable to replenish gas reserves,” he noted. Some figures State revenues during the governments of Evo Morales and Luis Arce (2020–2025) totaled around $60 billion, according to Rodrigo Paz, who alleged mismanagement and corruption involving part of those funds, which were not directed toward strengthening the state oil company. For hydrocarbons analyst Fernando Rodríguez, the balance after two decades is critical. Current gas reserves are estimated at around 3.7 trillion cubic feet (TCF), compared to 10.7 TCF in 2017. Additionally, gas production declined from 60 million cubic meters in 2014 to 27 million in 2025, lower than the 35 million recorded in 2006, according to the Fundación Jubileo. “They have dismantled YPFB, production has fallen, there are no reserves, and fundamentally we have destroyed the golden goose, which is YPFB—a company that will celebrate its 90th anniversary this year,” he said. According to Rodríguez, private investments were around $1.2 billion annually, but after being “driven away,” YPFB took over operations and failed in 15 projects in which it invested $1.5 billion, “not only due to inefficiency, corruption, and lack of technical capacity, but also because of geological reality.” “There is no sea of gas, and if we are lucky, we will find one or two megafields,” he stated. These difficulties have led to increased dependence on imports. Currently, Bolivia imports 90% of the diesel and 50% of the gasoline it consumes, and according to official projections, by 2029 the country will become a net importer of natural gas. READ ORIGINAL ARTICLE HERE New President of Bolivia’s YPFB Warns the Country Is “On the Brink of an Energy Crisis” The interim president of the state-owned company Yacimientos Petrolíferos Fiscales Bolivianos (YPFB), Sebastián Daroca, warned that Bolivia is “on the brink of an energy crisis” and that, if current trends are not reversed, the country may need to import natural gas within four to five years. If that occurs, Bolivia would shift from being one of the region’s largest natural gas exporters to an importer in less than two decades. “The lack of investment in recent years has caused our reserves to decline systematically, our gas and liquids production to fall, and this is a trend we must reverse as a national priority,” Daroca explained in an interview