Page 5 - LatAmOil Week 02 2022

LatAmOil COMMENTARY LatAmOil

Natural gas quickly was its preferred alternative per day, up by 16% or 10 mcm per day on the
– and imported LNG became part of the solu- H1-2020 figure of 32 mcm per day.
tion, since Petrobras and other upstream oper-
ators could not extract enough from domestic An eventual exporter?
fields to keep thermal power plants (TPPs) run- In the near term, Brazilian gas demand is
ning at full capacity. expected to remain strong, and the country is
The NOC said as much in its statement this working to build three additional LNG termi-
week, commenting that it needed LNG imports nals to add to Petrobras’ existing inventory of
to meet customers’ demand. five. (It’s worth noting, though, that the NOC has
only retained direct control of two of these and
Import data has leased the other three to private investors.) Brazil’s
According to other sources, LNG seems to have Even so, Brazil’s government appears to har-
come in particularly handy around mid-2021, bour some hope that this reliance on imported government
after Brasilia approved new policies designed LNG will be relatively short-lived. Mines and
to compensate for the decline in hydropower Energy Minister Bento Albuquerque said last appears to
output. November that the country might become a net harbour some
Data from Brazil’s Ministry of Mines and exporter of LNG within five to eight years.
Energy show that in June 2021, Brazil imported He noted that Petrobras was working with hope that
the equivalent of 35.1 mcm per day of LNG. several international oil companies (IOCs) to
At same time, ministry data also show that build the Route 3 pipeline, which will pump gas reliance on
Brazilian gas demand averaged 88.7 mcm per from offshore fields in the pre-salt section of
day in the first half of 2021, and the June LNG the Santos basin to an onshore processing facil- imported LNG
import number is equivalent to nearly 40% of ity in Rio de Janeiro State. When this pipeline will be relatively
this. becomes operational in early 2022, he said, it will
Interestingly enough, the total volume of serve as an export facility for gas from offshore short-lived
LNG imported in June appears to be roughly sites.
equivalent to the growth in gas demand rose in Albuquerque’s optimism about exports may
Brazil’s industrial and power-generating sec- be premature, though. Petrobras may be more
tors in between January and June of last year. inclined to direct pre-salt gas to the domes-
Ministry data show that gas demand in the tic market in the near term, assuming that the
country’s power-generating sector came to 44 pipeline does begin operating this year as antici-
mcm per day, up by 69% or 26 mcm per day on pated, and wait until the country’s capacities are
the H1-2020 figure of 18 mcm per day, while slightly more developed before it starts trying to
demand in the industrial sector reached 42 mcm enter the export market. ™

(Photo: Petrobras)

Week 02 13•January•2022 www. NEWSBASE .com P5