Production at the Mayaya field, estimated to hold 1.7 trillion cubic feet (TCF) of natural gas, should kick off in three to four years, YPFB said in a statement.
YPFB believes the area, north of Bolivia's administrative capital La Paz, could hold at least another five gas reserves of similar size, it said.
Development at Mayaya could cover the demand for gas in western Bolivia, according to the company.
The nation is facing an energy crunch linked to years of declining oil and gas production that has hit the country's currency reserves.
"This needed to be done many years ago, but we're doing it now," YPFB CEO Armin Dorgathen told journalists earlier this week.
Dorgathen told Reuters in an interview last month that the firm was looking for partners and financing to build up its flagging production.
The slide in domestic oil and gas output has been at the heart of Bolivia's recent economic and political woes. Once an important gas exporter to neighbors like Brazil, the production drop has hammered export revenue and left central bank reserves almost depleted.
Protests linked to the lack of dollars and long queues at gas stations have become increasingly common, stoking tensions and leading to in-fighting in the ruling socialist MAS party between President Luis Arce and former leader Evo Morales.
