Bolivia expropriates Spanish energy subsidiaries

LA PAZ, Bolivia (AP) ? President Evo Morales nationalized the Bolivian electricity distribution subsidiaries of the Spanish energy company Iberdrola in a public ceremony Saturday.

Morales issued a decree allowing the takeover of shares in Empresa de Electricidad de La Paz (Electropaz) and Empresa de Luz y Fuerza de Oruro (Elfeo), which supply energy in this Andean nation.

Soldiers guarded the installations of the electricity distribution companies, marked with signs reading: "Nationalized."

In the ceremony at Bolivia's government palace, Morales also announced the expropriation of an investment management company and a service provider belonging to the Spanish energy giant.

Morales said he had "been forced to take this step" to ensure that electric service rates remain "equitable" in the regions of La Paz and Oruro.

The Spanish government said in a statement that it regretted Bolivia's decision to nationalize companies that included "Spanish, Argentine and American companies among its shareholders."

Spain said it hoped "the process of assessing the value of the nationalized company is done with high standards of objectivity that would establish the just compensation to which shareholders are entitled."

Telephone calls and emails seeking comment from Iberdrola in Spain were not immediately answered.

The decree read by Morales calls for Iberdrola to receive indemnification after an independent firm is hired within 180 days to determine the value of the nationalized shares.

Morales in May also nationalized Transportadora de Electricidad belonging to Spanish company Red Electrica, which controlled 74 percent of energy transmission in Bolivia.

In his first year in office in 2006, the Bolivian president nationalized the oil industry through a renegotiation of contracts with a dozen oil companies, including Repsol, Petrobras, BG and Total.

In 2009 Morales transferred to state control the country's largest telephone operator, which had been controlled by Italy's ETI, and in 2010 he did the same with the four largest power generators, which had belonged to French-owned Suez, Rurelec of Britain and Bolivian shareholders.

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Associated Press writer Harold Heckle in Madrid contributed to this report.

Source: http://news.yahoo.com/bolivia-expropriates-spanish-energy-subsidiaries-162459554.html

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