Bolivia’s new leadership has pledged it would keep its existing lithium and oil and gas contracts, even those awarded to Russia and China under the previous leftist ruling, as La Paz looks to reassure investors that the signed deals would be respected.
“Our contracts will be respected,” Bolivian Energy Minister Mauricio Medinaceli told Reuters, including deals signed by the previous government with Russia and China.
Bolivia is estimated to hold more than a fifth of global lithium reserves.
This pledge is a “first message to investors” that they shouldn’t expect contracts to be torn up, despite the new Bolivian centrist government’s move to thaw relations with the United States.
At the end of 2025, centrist senator Rodrigo Paz won the presidential election in Bolivia. The new president immediately set to work to undo the policies of 20 years of nearly-uninterrupted socialist rule.
Bolivia’s new leadership, unlike the previous socialist governments, has the support of the U.S. Administration, which sent Deputy Secretary of State Christopher Landau to lead the U.S. Presidential Delegation to Paz’s inauguration in November.
Under the socialist rule of Evo Morales, Bolivia saw its energy industry nationalized and generous fuel subsidies paid out for years. These policies resulted in plunging natural gas production, dwindling foreign exchange reserves, a massive economic crisis, and fuel shortages as cheaper fuel in Bolivia encouraged smuggling en masse to neighboring South American countries.
The government will look to reform the subsidy and stabilize the fuel market, making sure subsidies reach those people who really need them, such as small enterprises, “and not those who profit from smuggling at the borders,” Medinaceli said in November.
Bolivia also aims to launch an oil and gas bidding round in 2027 if it manages to adopt this year a new hydrocarbons law and a separate lithium law to attract foreign investment.
By Tsvetana Paraskova for Oilprice.com
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