* Gov't, Spanish power firm to coooperate on compensation
* Leftist president nationalized REE's local unit
BUENOS AIRES May 7 Bolivia's government will
work with Red Electrica Espanola to decide how much the
Spanish power company should get in compensation for the
nationalization of its local unit, officials said on Monday.
President Evo Morales, who has steadily tightened state
control over the economy, ordered the army to take over the
Cochabamba headquarters of power transmission company Empresa
Transportadora de Electricidad (TDE) last week.
The leftist leader's decision to put the operation back in
state hands, which followed Argentina's move to expropriate
Spanish energy group Repsol's majority stake in YPF
, deepened European concerns about the investment
climate in South America.
However, after talks in La Paz, Energy Minister Juan Jose
Sosa and REE chief executive Jose Folgado said they would work
together to hire an independent company to put a value on TDE
for the purposes of compensation.
"With regards the matter of compensation ... over the
nationalization of TDE, we're going to work together in a
process based on objectivity and transparency," Folgado was
quoted as saying in a government statement.
Sosa, who echoed Folgado's comments, said last week that TDE
would be valued by a government-hired company within six months.
Red Electrica indirectly holds 99.9 percent of TDE, which
reported net profits of 12.5 million euros ($16.4 million) last
year, less than 3 percent of Red Electrica's 2011 net profits.
Spain's government initially criticized Bolivia's move to
seize control of TDE on the grounds the company had failed to
invest enough in the country, but later said it was legitimate
because the government of the Andean nation had guaranteed
($1 = 0.7603 euros)
(Reporting By Carlos Quiroga; Writing by Helen Popper; Editing
by Richard Pullin)