General Outline

First International Round of Blocks Promotion

Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) invites to all interested companies to invest in Bolivia’s hydrocarbon exploratory and production activities, under modalities of Exploration & Production Contracts and Research Agreements.YPFB estimates that Bolivia has a prospective gas resource potential of over 60 TCF and more than 2.500 MMbbls of prospective oil resources. These amount of resource is distributed in 53,5 MM hectares of our National territory.

Submission of proposals conditions

Opportunities for Oil & Gas Exploration in Bolivia

• Independent o�er submission for each block. • All companies wishing to participate must include proof of interest purchase of the Condition Documents (E&P Contract and/or Research Agreements), according to the types of agreements to sign. In case o�ers are presented through a consortium, each member of it must buy the mentioned documents.

SCHEDULE

International Calling Publication

Sale of the Bidding Conditions Document (DBL)

and Data Package.

Sale of Study Agreements Condition Document (DBCE)

the Data Package.

Written Inquiries.

Clarification Meetings.

Publication of DBL amendments or DBCE (if any).

Presentation of “Envelope A” and “Envelope B” for qualification.

Presentation of the documents for qualification.

Envelope opening ceremony.

Evaluation and selection of Oil Companies.

Notification to the Companies about the selection process result.

Signing of Contracts

Activity Study AgreementOil Service Contract (E&P Contract)

March 04th, 2012.

-

From June 11th 2012 to

July 06th 2012.

Until July 11th, 2012.

July 16th 2012 / 15:30.

Until July 20th, 2012.

-

July 27th, 2012 / 15:00.

July 27th, 2012 / 15:30.

From July 30th 2012 to

August 03th, 2012.

August 07th, 2012.

From August 08th, 2012

to October 05th, 2012.

March 04th, 2012.

From June 11th 2012

to August 10th 2012.

-

Until August 17th, 2012.

August 24th 2012 / 15:30.

Until August 31st, 2012.

September 14th, 2012 / 15:00.

-

September 14th, 2012 / 15:30.

From September 14th 2012

to September 21th, 2012.

September 24th, 2012.

From October 01 st, 2012

to November 30th, 2012.

Proved Reserves

Probable Reserves

Possible Reserves

Prospective Resources

(*) Millions of Barrels

Natural Gas (TCF)

9,94

3,71

6,27

60

Oil (MMBbl)(*)

209,81

98,22

4.34

2500

Bolivian Hydrocarbons Potential

Consultations and Clarification of Terms • Any company may access to consultations and clarifications of the conditions Documents through letters addressed to YPFB. All the consultations and clarifications will be answered by YPFB.

• YPFB will notify the companies who have purchased the Condition Documents and sent the intention letters.

• Likewise, YPFB will publish on its web page: www.boliviapromocionareas.com the answers to the consultations and clarifications requested by all interested Oil Companies.

Oil Companies Qualification

All interested companies in participating of the selection process, must submit the following: Intention LetterAlso must comply with: Technical Aspects • All companies must have service and operations experience in oil and gas exploration activities of at least 3 years. In the case of a Consortium, the added years of experience among members should not be less than 6 years.• Companies must prove their professional staff to develop and execute exploratory activities must have at least 10 years of experience, whether they are executive, managerial or technical personnel. Financial Aspects • Equity average of the last three years must be over US$ 20 MM, in order to become a bidder in any block.• Additional Equity average of US$ 10 MM per each additional block of interest.

All companies must render services and operations and they must submit all legal documentation to validate all technical and financial requirements.

• Exploration and Exploitation, also known as Risk Service Contract, allows the systematic Exploration of blocks and development and Exploitation of Hydrocarbons. In this case, a Mixed Economy Society (SAM) between YPFB (>= 51% share) and the investing company (=<49% participation) is constituted.

Research agreement Signing sequence of E&P Contracts

• Signing of the Research Agreement of the block.• Final report of the Research Agreement (No more than a year) • Signing of the E&P Contract (In case of interest of the Oil Company)

Financial Benefits for the Investment Company

From the perspective of incurred costs:Devolution of the investments of the exploration activities, in case of exploratory success, with the same field production. The exploration cost will be passed to the company, applying a discount rate according to the current USA inflation.

From the perspective of income:• Incomes according to the percentage share of the Exploitation block < 51%. (E&P Contract).

Contents, Data Package, Condition Documents and Assurances

Content

Data Package

Condition Documents

Assurances

Geological report of the exploratory leads.Determination of the lead Hydrocarbon potential.exploratory activities and investments programPreliminary Plan of the future Exploitation Project and investment.Evaluation of the Project and risk analysis.Production Forecast with expected cash flows.Geological Maps, structural, stratigraphic analysis, production capacity of the potential reservoirs and characteristics.Delimitation proposal of the selected block for the exploration.

Data package price is subject to each available reserved block.Seismic InformationGeological InformationWell InformationElectric LogSeismic Kingdom Project PresentationsBrochuresModel of the Study Agreement and/or E&P ContractModel of Statute for a Mixed Economy Society

(US$ 1,000.00)Research Agreement Document (DBCE), contains the following conditions: administrative, technical and economical, evaluation methodology and procedures.

(US$ 250,000.00)Fulfillment Assurance

Exploration PlanCommitted UTEs Estimated InvestmentsExploratory Activities Schedule

(US$ 2,000.00)Bidding Base Document (DBL), to subscribe E&P Contracts under the provision of services type contains the following conditions: administrative, technical and economical, evaluation methodology and procedures.

(US$ 50,000.00)Assurance of a serious proposal

Research Agreement E&P Contract

Type of Contract

Note: It is not a condition to make a Research Agreement for signing an E&P Contract.

• Research Agreement, it has the purpose to evaluate the Hydrocarbon potential of an block and to identify the corresponding exploitation opportunities which could enable an E&P Contract.

Blocks Technical DataGeological Provinces - Exploration Acreage

Beni

Santa Cruz

La Paz

Potosi

Pando

Oruro

Tarija

Cochabamba

Chuquisaca

27

1

57

60

58

63 8564

5

17

18 12

84

48

79

Geological Provinces - Exploration Acreage

References

Geological Provinces

Altiplano

Beni Plain

Chaco Plain

Madre de Dios Basin

Pantanal

Foothill

North Subandean

South Subandean

Explorations Acreage

Cities

Geological Provinces

Foothills

Southern Subandean

Altiplano

Madre de Dios Basin

Beni Plain

CedroCarandaitiLa GuardiaIvirzaAlegria

PelicanoHuacareta

CoipasaCorregidores

CobijaManuripiNueva EsperanzaMadre de Dios

LitoralEl Chore

99 775100 00090 62573 75076 500

46 250453 750

515 000655 000

333 750189 375372 500500 000

212 500262 500

5357203530

611

5179

278274

3148

735,122020,93334,90394,12557,16

177,54219,63

1740,461917,69

962,12364,03724,14178,82

767,821016,57

Yes - Yes - Yes

- Yes

- -

- - - Yes

- -

- Yes - Yes -

Yes -

YesYes

Yes Yes Yes

YesYes

Available Blocks Area (Has) Total Seismic Line

Seismic Line Length (Km) E&P Contract Research

Agreement

Blocks Technical Data

COIPASA

COBIJA

EL CHORE

CORREGIDORESHUACARETA

MADRE DE DIOS

LITORAL

MANURIPI

NUEVA ESPERANZA

CEDRO

IVIRZA

ALEGRIA

CARANDAITI

LA GUARDIA

PELICANO

BENI

SANTA CRUZ

LA PAZ

POTOSI

PANDO

ORURO

TARIJA

CHUQUISACA

COCHABAMBA

RIO

BEN

I

Río YataR

IO M

AM

OR

E

Río

Bla

nco

Río Pilcom

ayo

Río Piray

RIO A

BUNA

RIO ITENEZ O GUAPORE

Río Madidi

Río Ibare

Río Yacuma

Río

Beni

cito

Río Grande

Río Secure

Río

Neg

ro

Río Mercedes

Río Parapeti

Río Yapacani

Río

Tija

muc

hi

Río Manuripi

Río Isiboro

Río Rap

ulo

Río

Par

agu

a

Río San Pablo

Río Mizque

Río

Hea

th

Río

Man

upar

e

Río Desaguadero

Río Ichoa

Río Tuichi

RIO ORTHON

Río

Cha

pare

Río

Bar

ras

Río Sajama

Río Ichilo

Río Tahuamanu

Río SajtaRío Mauri

Río Guarayos

Río Tucavaca

RIO ACRE

Río C

hore

Río Tarija

Río Yuatre

Río San Martin

Río San Luis

Río Tarvo

Río La Paz

Río Caine

Río Geneshuaya

RIO ALTO BENI

Río

Man

urim

i

Río Coroico

Río Cub

eren

e

Río Boopi

Río

Cur

iche

Gra

nde

Río Pajta

Río V

ilcas

Río Chipamanu

Río

Man

iqui

Río Unduavi

Río Verde

Río Pesca

Río Altamachi

Río C

otacajes

Río Tupiza

Río Berm

ejo

RIO

MA

DER

A

Río

Cab

ito

Río Pailas

Río

Zong

o

Río Sabaya

Río A

yopaya

Río K

aka

Río Zapocoz Sud

Río

Lim

eta

Río Zapoco

z Norte

Río Pacahuaras

Río Quiquibey

Río Piraypani

Río

Quim

om

e

Río Chayanta

Río

Ñan

cahu

azu

Río Colorado

RIO

PAR

AG

UAY

Río Mulato

Río

Cie

nag

a

Río Camblaya

Río San Diablo

Río Atocha

Río M

oroco

Río

San

Mat

eo

Río

Jilc

he

RIO BENI

Río San Pablo

Río

Neg

ro

Río Pailas

Salar de

Coipasa

Salar de

Uyuni

References

Seep

River

Explorations Acreage

Lake

Cities

0 190 38095

Kilometers

0 190 38095

Kilometros

Oil Seeps Map

BENI

SANTA CRUZ

LA PAZ

POTOSI

PANDO

ORURO

TARIJA

CHUQUISACA

COCHABAMBA

Seismic Coverage and Exploratory Wells

Seismic Lines

Wells

Explorations Acreage

References

Cities

Current State Well

Producer

-

2

-

3

-

-

-

-

-

4

-

1

-

-

-

-

-

-

-

-

-

-

-

-

1

-

-

-

-

1

12

5

-

-

-

1

-

-

-

-

-

-

-

3

-

1

3

1

1

-

-

-

-

-

-

-

-

-

-

-

-

15

-

-

5

-

-

-

2

-

-

3

1

2

-

-

-

1

-

-

-

-

-

-

-

-

4

1

-

1

-

20

-

1

-

-

-

-

-

-

-

-

-

-

1

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

2

Abandoned

Total Wells

Dry Well

3

Closed Well

Nº Wells

5

3

5

3

1

-

2

-

-

7

1

3

4

-

1

4

1

1

-

-

-

-

-

-

5

-

1

-

1

1

49

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

In The Block

Near

Geological Provinces

Foothills

Blocks

Cedro

Carandaiti

La Guardia

Ivirza

Alegria

Pelicano

Huacareta

Coipasa

Corregidores

Cobija

Manuripi

Nueva Esperanza

Madre de Dios

Litoral

El Chore

Southern Subandean

Altiplano

Madre de Dios Basin

Beni Plain

Evaluation of Proposals

Working Unit Exploration (UTE), is the Bolivian nomenclature that systematizes the duties of the Exploration Activities (geophysics, magnetometry, gravimetry, drilling of exploratory Wells and other exploratory activities) and which must be performed by the investing company in the different Exploration phases.

Commited Exploration Program, equal or higher to the one defined by YPFB in UTEs

Increase of the participation of YPFB > to 51% of a Mixed Economy Society (SAM)

Number of requested Exploratory blocks in this choice, under Reserch Agreement type

Direct Participation of YPFB

Technical and Financial company’s Capacity.

50%

25%

10%

10%

5%

The submitted proposals will be evaluated by YPFB based on the following considerations:

Qualification criteria E&P Contract

Exploratory Activities

Seismic:

Each kilometer of the 2-D seismic line registered, processed, interpreted, mapped and also in the case of not being technically interpretable or mapped.

Each kilometer of 2-D seismic line Pre - existing before the e�ective date of the contract which is reprocessed, interpreted and mapped.

Each square kilometer of 3-D seismic which is registered, processed, interpreted, mapped and also in the case of not being technically interpretable or mapped.

Magnetometry:

Each lineal kilometer registered, interpreted and mapped with minimum spacing of 400 Meters of grids.

Gravimetry

Each lineal kilometer recorded, interpreted and mapped with minimum spacing of 1000 Meters of grids.

Exploratory Wells (Depth) (*):

1 5 Parcels> 5 10 Parcels> 10 20 Parcels> 20 40 Parcels> 40 80 Parcels> 80 120 Parcels> 120 160 Parcels> 160 200 Parcels> 200 300 Parcels> 300 400 Parcels

(*) For intermediate depths, equivalences in UTE will be determined by interpolating the two approximate values of depth.(**) 1 Parcel = 25 km2

5007009001200------

2.50

Size by Parcel block (**) Traditional Zone UTE Nontraditional zone UTE

1.000 meters2.000 meters3.000 meters4.000 meters5.000 meters6.000 meters7.000 meters

250.00440.00740.001.300.001.980.003.250.005.400.00

UTE Equivalent

Parameters of UTEs

300400500600700800900105012001300

0.15

6.50

0.01

0.02

Hydrocarbons Sale The natural markets of the hydrocarbons produced in Bolivia are Brazil and Argentina, currently guaranteed by long term contracts to buy/sell (Brazil 1999-2019, Argentina 2006-2026). In 2011, gross production of natural gas, reached an average of 45.07 MMm3/day and crude oil production and condensated reached 44.60 MBbl/day. In February 2012, the highest production of natural gas was attained with 48 MMm3/day. Approximately 80% of the natural gas production is intended for exporting markets.

Taxes • Companies Utility Tax (IUE), 25% over the annual net utility. In Upstream activities, tax regulation determines a straight-line depreciation of few years, encouraging oil operations in their first years.• Royalties (18%)• Direct tax on Hydrocarbons (IDH), 32% on the measured production in the tax point.• All other taxes are deductibles except Royalties. IUE and IDH.

Environmental Protection

The company which decides operating in Bolivia should develop environmental prevention and mitigation activities, ensuring conservation and protection of the enviroment, using the most advanced techniques, in accordance with the Bolivian regulations. Acting responsibly is a fundamental requirement for companies operating exploratory activities, specially in the development of environmental impact controls.

Legal Security

Each E&P Contract is approved by the Congress of the Plurinational State of Bolivia.

July

August

September

October

November

December

January

February

March

10.20

10.20

10.20

10.73

10.73

10.73

10.62

10.62

10.62

8.30

8.31

8.30

8.74

8.74

8.57

8.60

8.93

8.98

2011 - 2012 Selling price to Argentina (US$/MMBtu)

Selling price to Brazil(US$/MMBtu)

www.boliviarondaexploracion.com