EXPLORATION group Pan Andean Resources is to look for another partner for its oil and gas operations in Bolivia after the breakdown of its joint venture agreement with the Australian mining giant BHP.

Pan Andean had been looking for changes in the joint venture with BHP, but with no agreement being reached the contract between the two partners is to end at the beginning of July. Ownership of the Chapare exploration block will revert 100 per cent to Pan Andean together with drilling and seismic data assembled at a cost of over $30 million (£19.85 million).

Pan Andean director Mr David Horgan said that the group will need to replace BHP with another big partner and that discussions with potential joint venture partners are likely to get under way once the BHP agreement is finally terminated. "We don't intend to raise money, the way to add value is to do a farm out to a big sugar daddy who can spend money on exploration."

The breakdown of the BHP joint venture came late in the day and had no effect on the Pan Andean share price. On the AIM market in London, the shares were 4 1/2p higher on 52p, ahead of last year's low of 40p but well below the high of 115p last year.

Pan Andean shares collapsed last year from 115p to 40p after it emerged that a well in the 20 per cent owned Chapare block had failed to produce commercial quantities of gas. Despite that setback, Pan Andean chairman Dr John Teeling told the group a.g.m. last October that the prospects in Bolivia were good with Pan Andean in a better position than ever to become an oil and gal producer.

Whether Pan Andean achieves that ambition will depend on its ability to bring in a major joint venture partner who would fund the exploration on the Chapare prospect.