According to reports, the European Commission is said to be 'concerned' with hard line moves by the new Bolivian government to nationalize its domestic gas industry.

A number of European energy companies with interests and assets in the landlocked South American country are similarly worried. A report from energy news agency Platts suggests that the new Bolivian leader Evo Morales intends to seize 82% of all proceeds from every Bolivian gas property that produced more than 100,000 Mcf/d of natural gas during 2005.

If realized the development would leave companies such as Petrobras, Repsol, BG and BP with just 18% of their yields from Bolivian gas fields.

The commission noted with concern the decision taken which nationalizes Bolivian [gas] industry, Platts quoted a spokesman for the EU’s energy commission telling reporters in Brussels. We hope that before the decision is actually taken, any proposal will be discussed and that consultations will take place on it before it is adopted.

Currently the Bolivian gas industry is dominated by foreign majors and Mr Morales was recently swept to power on a ticket of reclaiming the nation’s energy wealth. After taking office the new Bolivian leader gave overseas gas companies 180 days to fall in line with his new policy. They are now halfway to the deadline. However, it is reported that Mr Morales has already mobilized military forces to occupy gas producing properties.

According to the Financial Times, foreign power companies have invested around $3.5 billion in Bolivia’s energy industry over the last decade.