* Natgas exports to quadruple by 2021 under new deal
* Neighbors plan to build new cross-border pipeline
* Repsol, Total plan to boost natgas output in Bolivia
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By Diego Ore
SUCRE, Bolivia, March 26 (Reuters) - Bolivia will quadruple natural gas exports to Argentina by 2021 under a deal signed on Friday that extends the deadline by nearly a decade for the Andean nation to boost fuel exports to its wealthier neighbor.
Exports of Bolivian natural gas to Argentina have not risen greatly despite a contract signed in late 2006 that called for an almost four-fold increase from the current maximum of 7.7 million cubic meters a day starting in 2010.
The revised deal signed in the southern Bolivian city of Sucre calls for a gradual increase in exports to reach 27.7 million cubic feet a day in 2021.
“It’s a long term contract, until 2026 ... natural gas exports will increase gradually,” Carlos Villegas, the head of Bolivia’s state-run energy company YPFB told reporters.
Under the new contract signed during a visit by Argentine President Cristina Fernandez, Bolivia will start sending to Argentina up to 19 million cubic meters by 2014 and up to 25.1 million cubic meters a day by 2019.
“The original deal was political, rather than technical. The new one is realistic and pragmatic. It calls for a gradual increase, and I think that Bolivia will be able to meet the terms this time,” said Bolivian analyst Bernardo Prado.
The deal has take-or-pay and delivery-or-pay clauses that call for penalties if Argentina does not take a minimum amount of natural gas, and for Bolivia if it fails to supply a minimum amount of fuel to its neighbor.
“Oil companies had complained that they were not going to extract more gas unless the market was guaranteed. These (clauses) give companies peace of mind,” Prado told Reuters.
Bolivia plans to boost exports to Argentina mainly by tapping its Margarita field, which is run by Spain’s Repsol (REP.MC). The company’s CEO Antonio Brufau attended the signing ceremony on Friday.
The neighbors plan to build a $100-million cross-border pipeline of some 37 miles (60 km), which would allow Bolivia to send up to 15 million cubic meters a day, but more pipeline infrastructure needs to be built to further boost exports. [ID:nN17151205]
Foreign energy firms in Bolivia, including Repsol, Brazil’s Petrobras (PETR4.SA) (PBR.N) and France’s Total (TOTF.PA), froze investments in the country after leftist President Evo Morales nationalized the natural gas industry in 2006.
But a consortium led by Repsol unveiled plans in late 2009 to invest $1.5 billion to boost natural gas output, and last month Total launched a gas exploration project, saying it may invest up to $500 million in the impoverished nation.
State-run energy company YPFB sees Bolivia almost doubling natural gas output to 76 million cubic meters a day by 2015.
Bolivia’s natural gas output has been steady at around 40 million cubic meters a day since 2006 and Brazil, by far the biggest buyer of Bolivian natural gas, cut imports by nearly a third in 2009 due to an economic downturn and heavy rains that allowed the country to produce more hydroelectric power.
But exports of Bolivian natural gas to Argentina rose by over 80 percent in 2009 to an average of 4.6 million cubic meters a day, which suggests that Argentina is eager to buy more fuel from Bolivia. [ID:nN24125054]
Bolivia has the second largest reserves of natural gas in South America after Venezuela and is the region’s main exporter, supplying the fuel to Brazil and Argentina. (Additional reporting by Carlos Quiroga; Writing by Eduardo Garcia; Editing by Marguerita Choy) (email@example.com; +59 1 2 244 4866; Reuters Messaging firstname.lastname@example.org))