Brazil's president protests to Morales over Bolivia's nationalization

Brazilian President Luiz Inacio Lula da Silva expressed his disappointment to President Evo Morales for the abrupt way Bolivia has carried out the nationalization of its natural gas sector, Brazil's foreign minister said Tuesday.

Foreign Minister Celso Amorim said the complaint was registered privately with Morales during a hastily organized presidential conference on the nationalization last week in Argentina, also attended by Venezuela's Hugo Chavez and Argentina's Nestor Kirchner.

Brazil, he said, chose to act quietly to avoid "a radicalization" by the Bolivian government.

Under last week's nationalization, Bolivia's state energy company Yacimientos Petroliferos Fiscales Bolivianos, or YPFB, will take majority control of all energy operations in the country and set gas prices. Foreign companies have six months to negotiate their contracts or leave the country. Morales sent troops to guards gas fields and refineries.

On Monday, the government named directors, mostly lawyers and military men, who will represent YPFB on the boards of the Bolivian subsidiaries of the foreign companies. Each company will have four directors representing YPFB and three directors for the foreign investors.

The new Bolivian directors were named for Bolivia Refinacion SA, a subsidiary of Brazil's Petroleo Brasileiro SA, or Petrobras; Andina SA, part of Spanish-Argentine Repsol YPF; Chaco SA, a unit of Britain's BG Group PLC and BP PLC; Transredes SA, of British-Dutch owned Shell Corp., and Compania Logistica de Hidrocarburos de Bolivia, which has various foreign shareholders.

Executives from Petrobras will meet with the Bolivian government Wednesday to begin contract negotiations. Bolivia is seeking to raise the price of gas it sells to Brazil, which gets half of its natural gas supply from the neighbor, reports the AP.

I.L.

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