Bolivia - Gas Pipeline Project

RESTRICTED Report No. p-970 FRF COrPY' This report is for official use only by the Bank Group and specifically authorized organizations or persons. It may not be published, quoted or cited without Bank Group authorization. The Bank Group does not accept responsibility for the accuracy or complcteness of the report. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO COMPANIA YACIBOL BOGOC TRANSPORTADORES WITH THE GUARANTEE OF THE REPUBLIC OF BOLIVIA AND THE ARGENTINE REPUBLIC June 16, 1971  REPORT AND RECOWE14DATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO COMPANIA YACIBOL BOGOC TRANSPORTADORES IJITH THE GUARANTEE OF THE REPUBLIC OF BOLIVIA AND THE ARGENTINE REPUBLIC 1. I submit the following report and reccmmendation on a proposed loan to replace the loan originally made in 1969 to Compania Yacibol Bogoc Transportadores (YABOG) for the construction of a natural gas pipeline from Santa Cruz in Bolivia to Yacuiba on the Bolivian-Argentine border. PART I - HISTORICAL 2. On July 1, 1969, the Executive Directors, acting on my recommen- dation contained in Report No. P-705 of June 19, 1969, approved a loan in various currencies equivalent to $23,250,000 to YABOG for the construction of a transmission system to deliver gas from Bolivia to Argentina pursuant to a 20-year Sales Agreement entered into in July 1968. The loan was signed on July 22, 1969 and guaranteed by the Republic of Bolivia. It was further jointly and severally guaranteed by YABOG's two owners, Yacimientos Petroliferos Fiscales Bolivianos (YPFB), the Bolivian state oil enterprise, and Bolivian Gulf Oil Company (BOGOC), with Gulf Oil Corporation of the United States guaranteeing the obligatimns of BOGOC. The Bank was to finance half of the cost of the project; the other half was to be financed by the New York State Common Retirement Fund (NYSCRF), which in June 1969 made a $25 million loan to YABOG iwith the guarantee of Gulf Oil Corporation. 3. On October 17, 1969, before the conditions of effectiveness of the Bank's loan had been met, Bolivia nationalized the properties of BOGOC and terminated its concession. This affected the guarantee of Gulf Oil Corporation, certain undertakings of BOGOC, and the organization of the gas fields near Santa Cruz, and rendered it impossible to declare the loan effective. Meanwhile, construction of the project had started and its interruption gave rise to additional costs, creating a gap in the financing. This gap was greatly widened when the NYSCRF decided to cancel the undrawn balance of its loan, reducing its amount to $14 million. 4. The nationalization notwithstanding, Bolivia and Argentina continued to have a strong interest in the construction of the pipeline. At the same. time,both the Bolivian Government and Gulf showed evidence of desire to reach an amicable settlement on payment of compensation for the nationalized properties. At a very early stage, the Bolivian Government confirmed to the Bank its intention to indemnify BOGOC, and shortly thereafter discussions began on the reconstitution of the project. In December 1969, the Argentine Government offered to give its guarantee for the Bankts loan in substitution for the guarantee of Gulf, and in February 1970 it agreed to postpone the date by which gas deliveries would start under the Sales Agreement.  5. On September 10, 1970, the Bolivian Government issued a Supreme Decree providing for payment to BOGOC of an amount of up to $101.1 million, determined by independent consultants as BOGOC's investment under its concession. A 22 percent tax, established by the same Decree and earmarked for exploration and project preparation by YPFB, reduced the amount to be collected by BOGOC to about $78.6 million. The indemnity is to be paid by channelling through a trustee 25 percent of the sales proceeds of exports of gas and oil from the Caranda, Colpa and Rio Grande fields (the fields formerly operated by BOGOC). Payments will cease when the amount of $78.6 million has been paid, or at the end of 20 years, whichever shall be the earlier. The Decree conditioned the payment of indemnity, inter alia, on the Bank's loan being made effective and on additional funds being provided to complete the gas pipeline project. At the same time, BOGOC concluded an agreement with the Bolivian Govern- ment in which, inter alia, it committed itself or Gulf Oil Corporation to continue Gulf's guarantee for the NYSCRF loan and to meet any cost overrun on the project. Also in September 1970, the Inter-American Development Bank (IDB), agreed to consider a loan to meet the gap in the financing plan. 6. By March 1971, after extensive consultations among the parties involved in the pipeline project, agreement was reached on arrangements for the management and operation of the Caranda, Colpa and Rio Grande oil and gas fields and on the payment, through a trustee, of the indemnity and debt service. At the same time, the Bolivian Government, YPFB and Gulf reached agreement on the settlement of various outstanding claims and counterclaims separate from the indemnity. This resulted in a net debt of $11.1 million, due to Gulf, which is to be paid by earmarking a part of the export proceeds from crude oil produced in the fields of Caranda, Colpa and Rio Grande. Most of this debt is expected to be repaid before indemnity payments begin; the balance will be paid soon thereafter with 10 percent of oil export proceeds being used for this purpose. 7. The negotiation of the Guarantee Agreement with Argentina took place on April 6 with lIr. Luis Alberto Rey, Under-Secretary of Energy, and Hr. Marcelo Huergo, Secretary to the Argentine Embassy in Washington. The renegotiation of the Loan Agreement with YABOG and the Guarantee Agreement with Bolivia, and the negotiation of the Gas Production Agreement with YPFB and the YPFB Santa Cruz Division, were carried out between April 21 and 26 with Messrs. Gonzalo Ruiz Ballivian, Under- Secretary at the Ministry of Finance, Rolando Prada Mendez, General Manager of YPFB and President of YABOG, Humberto Suarez Roca, Manager of YABOG, and Carlos Delius, Manager of the YPFB Santa Cruz Division. 8. The loan is the first made by the Bank in Bolivia. The status of previous IDA credits to Bolivia as of May 31, 1971, is given in annex 1. Report No. P-939 of May 14, 1971, in which I recommended for approval by the Executive Directors an IDA credit of $6.8 million to Bolivia for the third livestock project, described the current activities and lending prospects of the Bank group in Bolivia.  - 3 - PART II - DESCRIPTION OF THE PROPO03ED LOAN 9. Borrower: Compania Yacibol Bogoc Transportadores (YABOG) Guarantors: Republic of Bolivia The Argentine Republic Amount: In various currencies equivalent to US$ 23,250,000. Purpose: To help finance the constructicn of a gas pipeline from Santa Cruz in Bolivia to Yacuiba on the Bolivian- Argentine border. Amortization: In 20 years, including a 2-year period of grace, through semi-annual install- ments beginning July 1, 1973 and ending July 1, 1991. Interest rate: 6-1/2 percent, as approved when the loan was originally considered on July 1, 1969. Comritment charge: 3/4 of 1 percent per annum, accruing frcm September 20, 1969, as in the case of the original loan. The guarantee of the Argentine Republic (unlike the earlier guarantee of Gulf Oil Corporation) is subject to the limitations described in paragraph 26 below. PART III - THE PROJECT 10. The Santa Cruz-Yacuiba pipeline is an international project requiring the close cooperation of both Bolivia and Argentina to achieve success. It should prove of great benefit to both countries and make a contribution to the econcmic integration of South America. The project addresses itself to Bolivia's basic need for diversification and expansion of exports; it would strengthen Bolivia's external payments position and result in substantial tax revenue to the Government. At the same time, the project meets Argentina's demand for more natural gas, without the need for immediate heavy investment in the development of its own natural gas deposits. The project was appraised in Report No. PTR-19a (Appraisal of the Compania Yacibol Bogoc Transportadores Gas Pipeline Project) distri- buted to the Executive Directors on June 19, 1969. That report referred to the discovery of natural gas in the areas of Santa Cruz and Monteagudo in Bolivia, and to the gradual exhaustion of the Argentine gas field at Campo Duran, located near Yacuiba and connected with Buenos Aires with an existing gas pipeline. It further summarized the Sales Agreement,  - 4 - signed on July 23, 1968, by YPFB and BOGOC with Gas del Estado, the Argentine state gas enterprise, and providing for the delivery of 4 million m3 (141 Mvicf) of gas per day in the first seven years and of 4.5 million m3 (159 Ficf) in the following thirteen years. 11. The project consists of the construction of a 530km-long high pressure natural gas trunk line from Santa Cruz to Yacuiba, a 20km-long lateral line to Naranjillos and a number of river crossings, together with metering and regulating stations and other appurtenant facilities. It is expected to be completed in the first half of 1972. A 140km-long pipeline from the YPFB field at Monteagudo to the trunk line was included in the original project but will not be constructed, because the earlier interest which Bolivia had in deriving a larger net inflow of foreign exchange from YPFB fields, as compared with BOGOC fields, disappeared with the passing of the BOGOC fields into YPFB hands. 12. Construction was well under way at the time of BOGOC nationali- zation. In the spring of 1969 already, after international comnetitive bidding conducted in accordance with the Bankts guidelines, YABOG placed orders for pipe with Ferrostaal, A.G., of the Federal Republic of Germany and awarded the construction contract to 1Williams Brothers of the United States. Work on the project was interrupted in November 1969 because of the nationalization of BOGOC. By that time, however, about 140 km of trunk line pipe had been installed, the Naranjillos lateral line completed and much foundation work on the four major bridges carried out. Substantial quantities of pipe were stored in Argentina, and miscellaneous equipment and materials were in transit or awaiting shipment in the United States. 13. dJork on the project resumed in April 1971. The contracts wqith l-Jilliams Brothers and Ferrostaal have been reinstated on terms which, while more expensive than the original terms, are reasonable in the light of specific cost changes in the intervening period. YABOG has retained Van Houten Associates, a U.S. consulting firm which had formerly assisted BOGOC in designing bridges for the project, to carry out construction supervision originally entrusted to Gulf. 14. The project cost was estimated in 1969 at $46.5 million, about 10 percent of it representing the cost of Monteagudo lateral line. Price increases, the appreciation of the German mark, financial and storage charges, and the contractor's demobilization and remobilization expenses, have raised the cost estimates to about $56 million. Of this, about $51 million would be expenditure in foreign exchange and about $5 million in Bolivian pesos. The total consists of: $ millicn Construction services 24.5 Pipe 15.8 Other equipment and materials 3.8 Engineering and consulting services 3.4 Loan interest and other charges 5.6 Miscellaneous 0.9 Contingencies 2.0 7.0  Through 1970, about $27.5 million had been spent on the project, most of it before the nationalization of BOGOC. Of this, $14 million was disbursed by the NYSCRF and $8.2 million advanced by Gulf, while $5.3 million represented unpaid invoices for work performed by Williams Brothers. Pending the effective date of the Bank and IDB loans, YPFB arranged in May 1971 with the First National City Bank (FINCB) for a short-term loan in the amount of $10 million to finance the resumDtion of construction. This loan would be refunded from the proceeds of the Bank and IDB loans. 15. The financing plan for the reconstituted project provdes for $14 millicn made available in 1969 by the NYSCRF, $19 million from the IDB, and $23.25 million from the Bank. The terms of the NYSCRF loan remain unchanged at 20 years life and 7 percent interest. The proposed IDB loan (which is being presented to the IDB Executive Directors parallel with this loan) would be for 20 years, with amortization coRmencing after 4 years, and would bear an interest rate of about 8.2 percent. Any cost overrun on the project would be met by Gulf in accordance with commitments made to Bolivia, which will be confirmed directly by Gulf to the Bank at the time of the signing of the new loan documents. 16. Since the purpose of the loan and the basic project are unchanged from those approved by the Executive Directors in July 1969, and since a substantial investment in the project was made in 1969 following the action by the Executive Directors, I recommend that the interest rate of the proposed loan remain unchanged at 6-1/2 percent, with ccmmitment charge accruing from September 20, 1969, as under the original loan agreeTment. 17. The Bank and the IDB would enter into an agreement to co- operate in the administration of their respective loans. The proceeds of both loans would be available to finance new foreign exchange expenditures on the project and to reimburse the advances made by Gulf and -Williams Brothers. They would also reimburse YABOG for eligible expenditures on the project made out of the $10 million interim loan by FNCB. As in the original Bank loan, the Bank ifould reimburse expenditures made after April 30, 1969, and, in the case of engineering services, after July 31, 1968; similarly, the IDB management has recommended that, as an exceptional case, the proposed IDB loan be eligible, up to an amount of $13.5 million, to reimburse expenditures made after those dates. The proceeds of the Bank's loan would be applied mainly to the foreign exchange cost of the construction contract and those of the IDB loan to pipe procurement. In addition, each of the Banks would finance part of the foreign exchange cost of engineering and consulting services, and interest and certain other charges on its loan. The availability of the funds under the proposed Bank loan and the IDB loan would be inter-dependent. Local expenditure on the project and the remainder of foreign exchange expenditure would be covered by the loan from NYSCRF. 18. The economic rate of return on the project is presently estimated at about 20 percent. The rate of return on the original project, including the Monteagudo lateral, was 24 percent; writhout the Monteagudo lateral it would have been 33 percent. In other words, the reduction in the rate of return resulting from the increased cost of the trunk line  will be largely offset by the economies realized from abandoning the Monteagudo lateral. This rate of return assumes gas sales at the minimum volumes specified in the sales contract with Gas del Estado. However, the Argentine authorities have informed Bolivia that they expect to take substantial additional quantities for which both the gas reserves and the pipeline capacity wi11 be adequate. Such additional purchases would increase the rate of return on the project. 19. The Borrower, YABOG, is incorporated in the United States and has its principal domicile in Bolivia. Half of its stock is still held by BOGOC but will be transferred, before the signing of the renegotiated loan, to YPFB which will thus become YABOGts sole owner. The originally adopted policy that gas will be transmitted by YABOG at cost will be maintained. The draft Loan Agreement provides for the execution of the project under the supervision of experienced and competent management, and the present Manager of YABOG, a Bolivian engineer, meets these quali- fications. The draft Loan Agreement further provides that (i) YABOG will consult with the Bank on any proposed expansicn and will not undertake any new project which, in the opinion of the Bank, would substantially and adversely affect the position of the company or the efficiency of its management; and (ii) YABOG will not, without the Bank's agreement, incur any debt in excess of $100,000, in addition to the funds required to build the pipeline. 20. The Caranda, Colpa and Rio Grande fields are the source of gas to be transmitted through the pipeline and sold to Gas del Estado, and their efficient operation is crucial to the success of the project. To this end, the Bolivian Government issued on April 19, 1971 a Decree-Law authorizing YPFB to set up, within its legal structure, a separately- managed Santa Cruz Division to administer and operate the three fields. This Division was created, and its By Laws approved, by a resolution of the YPFB Board of Directors on April 22, 1971. It has a high degree of autonomy in administrative, commercial, financial and technical matters, including the right to enter into contracts, and the funds required for its operations are to be held segregated from other YPFB funds. Thus, the Division should not be greatly affected by changes in the management of YPFB. The Division is headed by an experienced and competent Bolivian NIanager, who reports to a Ilanagement Committee consisting of three high ranking YPFB officials. A representative of the Bank will attend the meetings of the Committee and participate in its deliberations without the right to vote. Moreover, the Division has entered into a contract with a leading firm of gas and petroleum consultants, De Golyer and 1IcNaughton, who will provide the head of the Division's operations depart- ment and other specialized technical assistance, and train Bolivian personnel on the job. The draft Gas Production Agreement between the Bank, YPFB and the YPFB Santa Cruz Division provides that the Manager of the Division will be appointed in agreement with the Bank and that the Division will continue to employ consultants acceptable to the Bank.  - 7 - PART IV - RE PAYME NT OF THE LOAN 21. Although Bolivia's ability to service debt on conventional terms is verj limited, the country is justified in assuming such debt in this case by the particular nature of the project, which will di- rectly earn in foreign exchange amounts substantially in excess of the service on the debt contracted for its construction. A cash flow projection for the Caranda, Colpa and Rio Grande fields, prepared by Bolivian officials, shows sales of gas to Argentina and of crude oil exported through Arica at $425.2 million for the years 1971-1991. These sales proceeds, and the proceeds of oil sales in the domestic market equivalent to $111.7 million, are expected to be applied as follows (for detail see annex 2): $ million Investment in the fields 18.3 Operating expenses ( Santa Cruz Division 98.4 ( YABOG 22.0 Service payments on loans 95.4 Indemnity to BOGOC 78.6 Surplus and taxes to Bolivian Government 224.2 536.9 22. Three trusts will be created in order to ensure the orderly distribution of export proceeds from oil and gas p~roduced in, or attrib- utable to, the Caranda, Colpa and Rio Grande fields among the various beneficiaries: the lenders for the pipeline; Gulf, in respect to its indemnity and the repayment of its other claims; YPFB and YABOG for operating expenses of the fields and the pipeline; and finally YPFB as the residual beneficiary. The agreements creating these trusts will provide that foreign purchasers of oil and gas will make payment in U.S. dollars to a trustee for distribution among the various interested parties. First National City Banlc of NewJi York (FNCB) will act as trustee. The three trust agreements wrill be: the Bolivian Crude Oil Trust Account Agreement between YPFB and FNCB; the Indemnity Trust Agreement between YPFB, Gulf Oil Corporation, BOGCOC and Fi\ICB; and the Lenders Trust Agreem- ent betTween YPFB, FNCB, IDB, the Bank, NYSCRF, Gulf and the Central Banlc of Bolivia. These agreements are to be signed prior to the signing of the Bank and IDB Loan and Guarantee Agreements. The Bolivian Crude Oil Trust Account Agreement and the Indemnity Trust Agreement will be approved by the Bolivian Government and the Lenders Trust Agreement by the Gov- ernments of Bolivia and Argentina. 23. Under the Bolivian Crude Oil Trust Account Agreement, YPFB will assign to the trustee 100 percent of export proceeds of oil and will agree to require the purchasers to pay the full price in U.S. dollars to the trustee. Beginning January 1, 1973 (or, at Boliviats option, three months  - 8 - after the start of gas exports to Argentina) the trustee will transfer 25 percent of the oil proceeds to the Indemnity Trust and 75 percent to the Lenders Trust. Prior to that date, and after the indemnity has been fully paid (or after 20 years), all the proceeds will be paid to the Lenders Trust. 24. Under the Indemnity Trust Agreement, YPFB will assign to the trustee) and the latter will pay to an account opened in the name of BOGOC, 25 percent of the proceeds of gas sold to Gas del Estado. The trustee will also credit the BOGOC account with 25 percent of oil export proceeds, in accordance with the aforementioned provisions of the Bolivian Crude Oil Trust Account Agreement. At the beginning of every month, the trustee will deduct and pay over to YPFB the 22 percent tax established by the Supreme Decree of September 10, 1970, the remaining balance being paid to Gulf Oil Corporation. Payments into the Indemnity Trust will begin on January 1, 1973 (or, at Bolivia's option, three months after the start of gas exports to Argentina) and will cease when Gulf has received $78.6 million or at the end of 20 years, whichever shall be earlier. 25. Under the Lenders Trust Agreement, the trustee will receive (i) frcn January 1, 1973, until the indemnity obligaticn has been satisfied, 75 percent of export proceeds of oil and gas produced in, or attributable to, the Caranda, Colpa and Rio Grande fields (and prior to January 1, 1973, and after the indemnity has been fully paid, 100 percent of such proceeds) and (ii) 100 percent of export proceeds of any other gas trans- mitted through the pipeline. The trustee will open a number of accounts, the beneficiaries of which will be: IDB, the Bank, NYSCRF and, if necessary to cover a project cost overrun, Gulf (or any lender brought in for that purpose by Gulf); Gulf as creditor under the claims settlement with the Bolivian Government and YPFB; and the Central Bank of Bolivia as a trustee for YABOG, the YPFB Santa Cruz Division and YPFB. The three lenders (and any lender financing an overrun) will have priority in respect of gas proceeds and to the extent that gas proceeds are insufficient to cover debt service, also in respect of oil proceeds. The prior claim of the lenders will be further strengthened by the establishment of a reserve account, in which will be deposited as from the date of project completion (and subsequently held on deposit) oil and gas proceeds sufficient to meet the next succeeding semi-annual debt service install- ments. The next-in-line beneficiary of oil proceeds will be Gulf in its capacity of creditor. The remaining oil and gas proceeds will be paid by the trustee to the Central Bank of Bolivia for allocaticn among YABOG, the YPFB Santa Cruz Division and YPFB. On the other hand, if the funds in the Central Bank account were to fall short of the operating needs of YABOG or the YPFB Santa Cruz Division, the arrangements contemplate that the lenders might instruct the trustee to release the necessary amounts from their accounts and the reserve account. 26. If the funds received by the Bank through the lenders trust were ever to fall short of loan service requirements, the Bank would turn for payment to the Guarantors, Bolivia and Argentina. The Bolivian guarantee is unconditional. The obligation of Argentina under its Guarantee Agreement  - 9 - is subject to suspension after 180 days in the event that gas deliveries to Argentina became impossible because of any act by the Bolivian Govern- ment deliberately designed to prevent them, or as a result of revolution, insurrection or war in Bolivia. The Argentine guarantee would further be suspended in the event of the suspension of the loan on the grounds of Bolivia's failure to meet its obligations under other Agreements with the Bank or IDA, and if such an event should lead to cancellation or prematuring of the loan, then the Argentine guarantee would be terminated. PART V - LEGAL INSTRUM4ENTS AND AUTHORITY 27. The draft Loan Agreement between the Bank and YABOG, the draft Gas Production Agreement between the Bank, YPFB and the YPFB Santa Cruz Division; the draft Guarantee Agreements between Bolivia and the Bank, and Argentina and the Bank; the Report of the Committee provided for in Article III, Section 4(iii) of the Articles of Agreement of the Bank; and the text of a Resolution approving the renegotiated loan are being distributed to the Executive Directors separately. 28. Except for several references to the trust arrangements, the draft Loan Agreement and the draft Guarantee Agreement with Bolivia follow substantially the form of the Agreements signed in 1969. The draft Loan Agreement includes, as additional events of suspension and prematuring, a default in the performance by any party under the Sales Agreement with Gas del Estado, the Lenders Trust Agreement and the Bolivian Crude Oil Trust Account Agreement. Certain specific features of the draft Gas Production Agreement and the draft Guarantee Agreement with Argentina have been referred to, respectively, in paragraphs 2-0 and 26 above. 29. Conditions of effectiveness of the proposed loan include the fulfilment of all conditions precedent to withdrawal under the IDB Loan Agreement, the acquisition by YABGG of all lands, rights and privileges necessary to construct the Project and carry on its business, and the granting of all necessary approvals and authorizations with reference to the loan and trust documents, the Sales Agreement with Gas del Estado, the Gulf overrun commitment and the By-Laws of YPFB Santa Cruz Division. 30. The agreements relative to the original loan will terminate upon the approval of the renegotiated loan by the Executive Directors. PART VI - TrFE ECONOMY 31. A report on the "Current Econacic Position and Prospects of Bolivia" (WlH-199) was distributed to the Executive Directors on June 1, 1970. A iiemorandum on Recent Economic Developments in Bolivia, summarizing the preliminary findings of an economic mission which visited the country in February/March 1971, was distributed to the Executive Directors  - 10 - on Flay 17, 1971, with the President's Report and Recommendation on a proposed IDA credit for the third livestock project (P-939). That report also referred to the status of service payments on Bolivia's external dollar bonds and to steps towards settlement of the claims arising from the recent nationalization of the assets of two U.S.-owned mining companies. PART VII - COMPLIANCE WITH ARTICLES OF AGREEM4ENT 32. I am satisfied that the proposed loan would comply with the Articles of Agreement of the Bank. PART VIII - RECONINENDATION 33. I recommend that the Executive Directors approve the proposed loan. Robert S. YeNamara President Washington, D.C. June 16, 1971  ANNEX 1 STATEMENT OF IDA DEVELOPMENT CREDITS AND IBRD LOAN TO BOLIVIA AS OF MAY 31, 1971 1/ Credit Amount (US$ million) Loan No. Year Borrower Purpose Bank IDA Undis- bursed 61 1964 Republic of Bolivia Power - 10.0 - 62 1964 Republic of Bolivia Power - 5.O - 107 1967 Republic of Bolivia Livestock - 2.0 0.03 148 1969 Republic of Bolivia Power - 7.4 5,98 635 1969 Compania Yacibol Bogoc Gas ) 23.25 - 23.25 Transportadores (YABOG) Pipeline) 171 1970 Republic of Bolivia Livestock - i.4 0.97 Total now held by Bank and IDA 23.25 25.8 Total undisbursed 23025 6.98 30.23 1/ On June 1, 1971, the Executive Directors approved a development credit of $6.8 million to the Republic of Bolivia for a third livestock project. 2/ Not yet effective.  SOURCES AND APPLICATION OF FUNDS: YPFB SANTA CRUZ DIVISION AND YABOG US$.000 Year ended December 31 1971 1972 1973 1974 1975 1976-1980 1981-1991 Total I. Sources of Funds Income Exports of Gas - 10,456 13,941 13,941 13,941 72,820 172,931 298,030 Exports of Crude Oil 15,130 22,743 19,602 17,332 15,728 33,916 2,737 127,188 Internal Consumption of Oil 6,785 6.785 6,785 6,785 6,785 33,925 43,866 111,716 21,915 39,984 40,328 38,058 36,454 140,661 219,534 536,934 less Operating Expenses Gas Pipeline 600 636 674 714 4,258 15,102 21,984 Fields and Oil Pipelines 5,759 7,024 6,587 6,239 6 22,392 44,34284 0 5,759 7,624 7,223 6,913 6,761 26,650 120,374 less Taxes on Transport 5.752 9,385 9365 8,864 8,509 33,243 48,600 123,718 11,511 17,009 16,588 15,777 15,270 59,893 108,044 244,092 Net Cash from Operations 10,404 22,975 23,740 22,281 21,184 80,768 111,490 292,842 Loans for Gas Pipeline 38,250 7,71_ 46,000 Total Funds Available 48,654 30,725 23,740 22,281 21,184 80,768 111,490 338,842 II. Application of Funds Capital Expenditure on Fields and Gas Pipeline 42,200 10,655 981 710 786 2,687 6,237 64,256 Debt Service 1,685 1,635 2,969 4,241 5,141 27,664 52,097 95,432 Indemnity to BOGOC _- 7,863 7.421 7,109 27,427 28,802 78,622 TOTAL 43,885 12,290 11,813 12,372 13,036 57,778 87,136 238,310 III. Surplus Annual 4,769 18,435 11,927 9,909 8,148 22,990 24,354 100,532 Cumulative 23,204 35,131 45,040 53,188 76,178 100,532  .akr TCti. 0 LA PAZ / t " u BOLIVIA <> ./ t t\ Willa Tunarl t to Pto. Villarroel .laT.. OIL AND NATURAL GAS FIELDS AND PIPELINES V i t a *0 3' CRUZ 0 TOWNS > \ rSA l O (a~~~~~~~~~~~~~~~~~~~~,bardor. d) 9 | < ; t rio nu t / vanX (v s01 / p A R A 1~~~~~~~~~~~~~~~~~~~~~~~~~~~~~T . a c < - ' o AUyun1 j li z ,_.__~~~~~~~~~~~~~~~~~~~~~ RAILROAD ' j N E E h I ' X r ffi j ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ROADS SUCRE o, bTrini d a h n < . .,,,,,,, . CRUDE LINE 0 . 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