Page 13 - LatAmOil Week 35 2021

LatAmOil BRAZIL LatAmOil

The signing of the supply deal took place against monopoly position of Petrobras, which used to
a backdrop of liberalisation in Brazil’s domestic account for around 80% of Brazilian production.
gas market. Previously, the national oil company According to Brazilian Mining and Energy Min-
(NOC) Petrobras was the country’s sole supplier ister Bento Albuquerque, the law could unlock
of gas, delivering some of its own production BRL40bn ($776.67mn) in private investment for
and volumes sourced from other producers, the gas sector.
including Shell, to distributors. The liberalisation programme will take years
But in March, the lower house of Brazil’s to implement. It will see gas exploration and
Parliament approved a bill aimed at opening up production operations unbundled from trans-
the gas market to private competition. The long- port and distribution, in a bid to attract more
awaited legislation is expected to shatter the upstream investment. ™

Petrobras and Excelerate finish

negotiations on Bahia LNG lease

BRAZIL’S national oil company (NOC) Petro- an important milestone in the process of pro-
bras has reportedly finished negotiations with moting competition in the Brazilian natural gas
US-based Excelerate Energy on a proposed sector,” he said. “We understand that increasing
leasing contract for the Bahia LNG terminal and access to flexible LNG supply is critical to sta-
hopes to conclude the contract soon. bilising Brazil’s energy system, especially dur-
Petrobras marked the conclusion of negotia- ing adverse weather events such as the current
tions last week by issuing a statement revealing severe drought.”
that it had wrapped up the process of verifying The Bahia LNG terminal is capable of
the commercial viability of Excelerate’s offer. importing and regasifying the equivalent of
This means that the US company’s Brazilian sub- 20mn cubic metres per day of LNG. Petrobras
sidiary Excelerate Energy Comercializadora de has described the terminal as “an island-type
Gás Natural has “advanced to the qualification pier with all the necessary facilities for mooring
stage” of the bidding contest, the NOC said in [an FSRU] ship directly to the pier and a supply
the statement. ship on the port side of the FSRU.”
It also explained that it is waiting for Exceler- According to previous reports, Excelerate’s
ate to submit all the documentation needed to lease will cover assets associated with Bahia
evaluate the legal, economic and financial terms LNG – namely, a 45-km pipeline that runs
of the proposed lease. Once the NOC receives from terminal facilities in the port of Bahia to
these materials, the draft contract will be sub- exit points in São Francisco do Conde and São
mitted to the relevant divisions of Petrobras for Sebastião do Passé, along with the power-gener-
approval, it said. ating facilities in the Madre de Deus Waterway
Excelerate confirmed that it had wrapped Terminal (TEMADRE). However, it will not
up negotiations with Petrobras in a separate include access to the Excelerate Experience, an
statement and said it hoped to begin executing FSRU that Petrobras has installed at the port of
the lease contract in the near future. “Once the Bahia. ™
financial and legal qualification and certifica-
tion stages have been concluded and all neces-
sary regulatory approvals have been obtained,
Excelerate will start importing LNG and selling
regasified natural gas to its Brazilian customer,”
it commented.
It also said that one of its first moves would
be to deploy one of its own floating storage and
regasification units (FSRUs) at the Bahia termi-
nal. This will expand the capacity of the facil-
ity, which is already capable of handling up to
700mn cubic feet (19.8mn cubic metres) per day
of regasified LNG.
Stephen Kobos, the CEO of Excelerate, said
that the leasing contract for the Bahia LNG
terminal would benefit Brazil. “Petrobras’ deci-
sion to advance in the tender for leasing the
Bahia regasification terminal to Excelerate is Excelerate will deploy an FSRU at the Bahia LNG terminal (Photo: Bahia Pilots)

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