Bolivia’s
Bulo Bulo ammonia and urea plant restarted production on Sept. 6 after an
almost 22-month hiatus. The plant is targeted to produce 44,000 mt of urea this
month, according to a BNAmericas report,
citing the plant’s operator, state-run oil and gas company Yacimientos
Petrolíferos Fiscales Bolivianos (YPFB).
YPFB’s
Industrialization Manager Henry Lapaca reported that the Bulo Bulo facility,
located in Bolivia’s central Cochabamba province, is producing 1,470 mt/d of
urea, and is working at a 70 percent capacity utilization.
The oil
and gas company estimates the plant will produce 590,000 mt of urea by
September next year, according to a separate BNAmericas report this week.
Bulo
Bulo is Bolivia’s only nitrogen fertilizer production facility. It has a nameplate
capacity of 2,100 mt/d of granular urea.
According
to the initial BNAmericas report,
citing YPFB’s Manager of Derived and Industrialized Products Gabriela
Delgadillo, of the September output, around 7 percent will go to the domestic
market, while the balance will go to foreign markets.
Bulo
Bulo urea has previously been exported to five countries, including Brazil,
Argentina, Paraguay, Peru, and Uruguay. Delgadillo said the company is working
to recover from “the loss of credibility” in markets given the length
of time production has been stopped. However, the executive said some 10,000 mt
of urea already is awarded to the Brazilian market, and the contract for the
sale – with a previous Brazilian customer – is in the process of being signed.
Bolivia
exported 305,040 mt of urea in 2019 and 21,769 mt in 2020, according to Trade Data Monitor statistics. The 2020
export volumes are understood to have come from inventory.
In the
domestic market, before the plant stoppage, YPFB had succeeded in replacing
imports of urea, but now faces the challenge of displacing those imports, according
to the report, citing Delgadillo. He estimates the sale of up 150,000 mt of
urea from Bulo Bulo during the remainder of 2021. Of that volume, around
125,000 mt is targeted for export sale, while the balance will go to the
domestic market.
As
noted earlier, in the 12 months to September 2022, YPFB is targeting to produce
590,000 mt of urea. Of the targeted output, some 46,000 mt is expected to be
sold domestically, while about 544,000 mt will be exported. Brazil is expected
to be the recipient of over 70 percent of the export volume and Argentina
around 23 percent, with the remaining volume expected to be sold to Paraguay
and Peru, according to the company’s plans.
The
Bulo Bulo plant began operations in September 2017, but has suffered a series
of operational problems since start-up.
This
latest production stoppage – arguably the most serious and far-reaching – began
in November 2019 (GM Jan. 31, 2020).
According to comments in March 2021 by YPFB Executive President Wilson Zelaya,
the shutdown of operations at the plant was not done according to proper
procedures, and resulted in some damage to equipment. He said an adequate
hibernation of the plant was not undertaken, nor was proper maintenance
performed during the 12 months and more to date of its shutdown (GM March 26, p. 35).
Many
blamed the alleged use of unqualified personnel for the damage at the plant
amid the country’s political crisis in November 2019, which saw the resignation
of controversial President Evo Morales and the assumption to the presidential
role of Jeanine Áñequalz Chávez, which also was not without controversy.
After a
landslide win for the Movement for Socialism the following year and the installment
of new President Luis Alberto Arce Catacora on Nov. 8, 2020, work began on
rehabilitating and reactivating the Bulo Bulo plant.
A probe
at government level was launched in March into the alleged mishandling of the
Bulo Bulo facility. However, little has been heard about its findings to date.
According to the BNAmericas report
this week, “the economic injury” to the Bolivian state exceeds $428
million.
