NATURAL GAS FUELS ENERGY INTEGRATION

The IDB will help finance a 3,146-kilometer pipeline to transport natural gas from producing fields in Bolivia to consumption centers in Brazil in a project that will bring major environmental as well as economic benefits.

Bolivia has abundant reserves of natural gas, a relatively clean-burning source of energy. Construction of the pipeline will open an export market that could produce initial revenues of some $200 million annually, eventually rising to $300 million. The country's export earnings are currently on the order of $1 billion a year.

For Brazil, the project will result in a substantial increase in the use of natural gas, which currently makes up just 2.4 percent of the country's energy consumption. Today, more than a third of Brazil's energy needs are being met by hydroelectric power, but the most economical sites have already been exploited and the economic and environmental costs of further development are high. Oil and other nonnatural gas fossil fuels represent another large share of energy consumption, but the public is growing concerned over their costs in terms of pollution.

Until recently, Brazilian law gave the country's petroleum company, Petróleo Brasileiro, S.A. (known as Petrobras), a monopoly on the development, transport and importation of natural gas. But recent changes allow for these functions to be delegated by the government to private or public companies.

The gas pipeline project will be carried out by Transportadora Brasileira Gasoducto Bolivia-Brasil S.A.(TBG). The Brazilian government's participation in TBG (through Petrofertil S.A., a subsidiary of Petrobras) will not exceed 51 percent of the company's capital, leaving at least 49 percent of the company's shares for private ownership.

The IDB loan for $240 million will help cover costs for pipeline construction in the Brazilian portion of the project. When the entire project is completed, the pipeline will carry natural gas from Río Grande in Bolivia to Porto Alegre in southern Brazil, with intermediate distribution points in São Paulo, Curitiba, Florianópolis and other cities.

The total cost of the project is $1.67 billion. Other financing sources include the World Bank, the Andean Development Corporation, the European Investment Bank, Banco Nacional de Desenvolvimento Econúmico e Social, the Export-Import Bank of Japan, and project partners and suppliers.

The pipeline will be 32 inches in diameter in its initial section and 16 inches in its final section. It will have a total carrying capacity of 30 million cubic meters per day.

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Guyana

A BETTER PLACE TO STUDY

"Lang time gat am leaky roof, now you gat am well sealed roof," sang the students at the inauguration of the Stewartville Primary School in Guyana. "Lang time gat am bucket water, now we gat am overhead," they continued.

According to a recent report in the Guyana Chronicle, things certainly have improved in Stewartville, where adults remember going to school in a former hardware store. The new school, which currently has 273 pupils and 14 teachers, can accommodate 400 students. Facilities include a library, a canteen and a sick bay, in addition to class rooms and office space.

The Stewartville inauguration was just one in a spate of recent school openings, the result of a nationwide program financed with the help of a $46.4 million IDB loan. Included in the program is the construction of 19 schools and the rehabilitation of 36 others. The program also includes training for some 1,000 teachers, curriculum development and production of textbooks, and strengthening administration and supervision of the Ministry of Education.

In a second program that the Bank is expected to help finance, original school construction plans were scrapped because they were judged to be excessively modern and costly. The new specifications will cut the costs of the schools in half, according to Charles T. Greenwood, IDB representative in Guyana. The savings of $20 million will make it possible to build many more schools and carry out other measures to strengthen the primary education system.