Morales defends nationalization of Bolivia's gas

Bolivia's leftist president defended his decision to nationalize the country's natural gas reserves despite objections from foreign governments and energy companies, saying Bolivia is seeking "partners, not owners" to help harvest its natural resources.

Photo: Morales defends nationalization of Bolivia's gas

President Evo Morales also said he would attend a summit Thursday with the presidents of Argentina, Brazil and Venezuela to discuss Monday's nationalization announcement, which rattled the region and raised fears it could drive petroleum companies out of South America's poorest nation.

"We're not expelling any company, but they will not earn much, not like before," Morales said late Tuesday to Venezuela's Telesur TV network in his first interview with foreign media since the announcement. "We hope they'll remain partners and if they don't respect these laws, we'll make them respect them with political force."

Further raising fears among investors, Bolivia's government said it wanted to also extend its control over mining, forestry and other sectors of the economy.

Soldiers were posted at 56 gas installations around the country Tuesday, a day after Morales issued the decree that some saw as an expansion of the leftist, populist polices of Venezuelan President Hugo Chavez.

Chavez, a close Morales ally, said Morales' move would help meet the needs of Bolivia's poor.

Thursday's summit in Puerto Iguazu, Argentina will help "avoid all the alarmist news being put out by the world's media ... they are not going to sow discord among us, because that's what they want, to alarm the companies, alarm the people," Chavez said.

In Peru, Ollanta Humala, the nationalist presidential hopeful headed to a runoff election, has said he too would force foreign mining and gas companies to renegotiate contracts. But on Tuesday, Humala softened that message.

"We respect the sovereign decisions of our brother nation Bolivia, but what I want to say emphatically is this: We have never talked about either state takeovers or expropriation," Humala told reporters.

On Tuesday, Vice President Alvaro Garcia Linera said mining companies could face higher taxes and royalty payments and that the government will intensify enforcement of existing laws to break up big underdeveloped land holdings, apparently to turn them over to the poor.

The government also will crack down on foreign timber companies violating conservation laws, Garcia said, and would steer companies to export finished wood products rather than raw timber.

While the gas nationalization decree was not unexpected, analysts said the images of soldiers toting automatic weapons outside refineries and gas fields were reminiscent of past military dictatorships.

"With this move, he risks alienating natural and otherwise sympathetic partners like Brazil and Spain," said Michael Shifter, a Latin American analyst at the Inter-American Dialogue think tank in Washington. "Ordering the military to seize the natural gas fields is unnecessarily confrontational and antagonistic,» reports the AP.

I.L.