Bolivia Courts Brazilian Petrobras Under New Hydrocarbon Framework as Paz Pursues Multi-Nation Investment Drive

Bolivia’s Hydrocarbon Minister Mauricio Medinaceli accompanied Paz to a meeting with Brazilian President Luiz Inácio Lula da Silva on March 16, 2026, with an agenda focused on inviting Petrobras to invest in exploration and exploitation under a forthcoming hydrocarbon law. The proposed legislation will replace the system implemented in 2006 under former President Evo Morales, which allocated 82 percent of revenue from high-production fields to the state through a combination of royalties, direct hydrocarbon tax, and YPFB participation, leaving private companies just 18 percent for costs, amortization, and profits.

The new framework will establish a baseline tax reference of 50 percent based on the 2004 referendum, but will introduce variability depending on technical field conditions and market circumstances. Medinaceli characterized the revision as essential to reactivate natural gas and petroleum production, both of which are currently declining. Brazil represents a strategic partner given the historical relationship between Petrobras and Bolivia’s energy sector.

Paz’s international agenda includes attending the inauguration of Chilean President-elect José Antonio Kast, where bilateral meetings are scheduled. Spain’s King Felipe VI is confirmed to visit Bolivia to promote business linkages with formal and informal sectors, an engagement Paz indicated would open connections with French and German leadership. The administration positioned these diplomatic efforts as mechanisms to attract technology and investment while stabilizing the dollar and hydrocarbon sector.

The bilateral agenda with Brazil extends beyond upstream oil and gas investment to electrical interconnection projects benefiting border regions. Three interconnection initiatives are planned to serve Beni, which currently relies heavily on diesel-fired generation, along with similar projects for Pando and Santa Cruz. These infrastructure developments aim to reduce diesel consumption and provide consistent electricity supply to regions lacking grid access. The government frames the combined hydrocarbon reform and electrical integration as critical to economic stabilization and talent retention, addressing the migration crisis that has depleted Bolivia’s workforce and technical capacity over two decades.