Petrobras, Gazprom sign gas agreement

SAO PAULO (AP) — The state-run oil companies of Brazil and Russia signed a memorandum of understanding Saturday to identify possible areas of cooperation on natural gas projects.

Petroleo Brasileiro SA and OAO Gazprom did not name any projects or disclose possible amounts for investment, but Petrobras said it is interested in Gazprom technology for development, storage and transport of liquefied natural gas.

Petrobras and Gazprom could seal deals on liquefied natural gas projects by 2007, the Brazilian company said in statement. Petrobras is also interested in Gazprom technology for pipeline construction.

Brazil is trying to prepare to wean itself from dependence on Bolivian natural gas, and Petrobras officials have said repeatedly over the last year they are interested in liquefied natural gas projects, which would allow gas from elsewhere in the world to be delivered by ship to Brazil.

Brazil gets about half of its natural gas for power generation and as fuel for cars and cooking from Bolivia, but the two nations were locked in an energy dispute for much of the last year.

Bolivia, which has South America’s second largest natural gas reserves, nationalized its energy industry last year and moved to assert control over foreign companies operating in the Andean nation, including Petrobras.

Tensions between Brazil and Bolivia eased last week, when their presidents signed an accord that could mean a price hike of as much as 11 percent for the gas Brazil imports from Bolivia.

Brazilian President Luiz Inacio Lula da Silva and Bolivian President Evo Morales reached the deal after marathon negotiations in the Brazilian capital.

Both leaders declared the impasse over and said relations will improve — though top ministers from each country gave differing estimates on how much prices would rise.


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