[ad_1]
Colombia wants extra pure gasoline imports to fulfill rising energy demand as El Niño-influenced climate situations have resulted in water shortages, necessitating a shift away from hydroelectricity.
The development has put stress on already constrained gasoline provides within the nation. However a latest proposal so as to add import capability with a second LNG terminal obtained just one bid.
“It’s probably that Colombia would require extra liquefied pure gasoline imports within the subsequent few years, particularly with El Niño climate situations and vital variations on rain patterns…” stated Diego Rivera Rivota, a analysis affiliate at Columbia College’s Heart on International Power Coverage.
Though Colombia is a small LNG importer in comparison with Argentina, Brazil and Chile, imports of the super-chilled gas have jumped from practically 100,000 metric tons final 12 months to 350,000 metric tons on the finish of September, in keeping with Kpler.
Pure gasoline will play a key function within the energy sector by balancing variations on hydropower era within the short-term, Rivota stated.
“On the provision aspect, the declining development on gasoline manufacturing and restricted reserves helps the necessity to depend on imports,” he added.
“Imports are already greater this 12 months than for the entire of 2022, so we may even see this development within the subsequent few years.”
Colombia’s confirmed gasoline reserves of 80 billion cubic meters have a restricted manufacturing lifetime of about 7.2 years primarily based on the present charge of extraction, in keeping with the Worldwide Power Company. Many of the gasoline consumed in Colombia is produced regionally and used for energy era.
Since 2016, LNG has been delivered to the nation’s solely import facility, a 3 million metric tons/per 12 months (mmty) floating storage and regasification unit (FSRU) at Cartagena. The FSRU is operated by the Sociedad Portuaria El Cayao SA (SPEC), a partnership amongst Colombian power firm Promigas and Dutch midstream firm Royal Vopak NV.
SPEC is reviewing curiosity to doubtlessly increase capability at Cartagena for 2026-2028 to fulfill future gasoline demand. Nevertheless, Rivota stated the Cartagena FSRU was underutilized final 12 months at a charge beneath 10%.
A proposal for a second LNG terminal by Colombia’s mines and power ministry, Unidad de Planeación Minero-Energética (UPME) obtained just one bid for a facility on the port of Buenaventura on the nation’s Pacific coast. Estimated to value between $700 to $900 million, the primary tender was canceled in 2021 as a consequence of a scarcity of investor curiosity.
Rivota stated there’s a sense of threat and uncertainty concerning the challenge proposal at a political stage given the present administration’s unclear method to reconcile local weather objectives and power challenges.
President Gustavo Petro’s resolution final 12 months to ban new fossil gas exploration to give attention to renewables to energy Colombia’s power demand has “weakened investor confidence within the power sector, discouraging investments in new electrical energy era capability required to fulfill future demand development,” in keeping with Fitch Scores.
The federal government’s choices, Fitch stated, pushed electrical energy costs within the spot market to common $252/MWh in September 2023, in contrast with $57/MWh in August 2022 and $28/MWh in August 2021.
Not all of the nation’s authorities ministers agree with Petro’s fossil gas coverage, as oil and coal represented about half of Colombia’s exports final 12 months. Present fossil gas tasks have been allowed to proceed, however it’s unsure if the federal government will award any new oil and gasoline exploration contracts.
In the long run, as storage applied sciences grow to be extra reasonably priced, and with additional additions of renewable power like geothermal or hydro, the function for pure gasoline will probably lower and ultimately phase-out by 2050, Rivota stated.
“There’s a pending activity for policymakers to reassess if and the place increasing regasification capability, in addition to growing extra pipelines is sensible, particularly contemplating the capital-intensiveness of those tasks, and the gasoline demand within the medium and long-term. However extra regasification terminals may additionally be liable to turning into stranded belongings.”
The put up Lack of Investor Curiosity Inhibits Colombia’s Plan to Increase LNG Imports appeared first on Pure Fuel Intelligence
[ad_2]
Source_link
