Skip to content

SOUTH AMERICAN ENERGY MARKETS DAILY ROUNDUP (April 24, 2009): Ecuador plans to enter LNG liquefaction age by 2011

April 24, 2009

South American Energy Markets (SAEM) publishes a daily roundup of the top-five stories affecting energy markets in the region with links. The roundup includes all the major web dailies of South America and other websites that write about the region’s energy markets. SAEM Daily Roundup appears from Monday through Friday and is published by noon London time.

Friday, April 24, 2009


State-owned energy company Petroecuador announced the construction of a liquefaction plant in southern Ecuador that will supply 10 million cu ft/day to the local market. The plant, which will be built by Ros Roca Indox Cryo Energy of Spain, will take about 2.3 years to come onstream in Canton El Guabo, a property owned by the energy company, located in the southern Ecuadorean province of El Oro. The first phase of the project aims to supply by truck the provinces of Pichincha (northern Ecuador), Guayas (Guayaquil) on the Pacific coast, and Azuay, located north of El Oro. COMMENT: The announcement by Petroecuador is significant because it places Ecuador as the third country after Peru, Venezuela and Brazil that will enter the gas liquefaction age. The plant is small, like the one in Brazil that transports LNG by truck from the Paulinia plant in Sao Paulo state, could see expansion in the future if new gas reserves are found. Ecuador’s proved and probable reserves amount to a mere 0.6Tcf.


The president of LNG Quintero, Antonio Bacigalupo, was quoted as saying that the $1.1-billion LNG terminal in central Chile is 95% complete, reports Santiago daily El Mercurio. The 2.5 million tonnes/year plant, which will begin operating at full capacity from 2010, will get its first shipment (145,000 cu m) of LNG in June. The consortium operating the plant comprises of BG Group, Enap, Endesa Chile and Metrogas. COMMENT: Hydrocarbons poor Chile imports about 70% of its energy needs. The sharp fall in gas supplies from Argentina came as a hard economic blow to Chile. The new plant will help Chile to diversify energy supplies and rely less on its neighbor for gas.


Initial investments that Petrobras plans to spend 70 billion reales ($31.7 billion/€24.2 billion) in its 2009-13 investment plan to develop the huge offshore oil and gas reserves of of the pre-salt crust area, writes quoting Agencia Brasil. The investments would be earmarked for drilling 22 wells in the offshore regions of Southern (Parana, Santa Catarina, Rio Grande do Sul) and Southeast Brazil (Sao Paulo, Rio de Janeiro and Espirito Santo). COMMENT: The sum announced by Petrobras is small compared with over $100 billion required to develop the reserves of the promising Santos Basin. The high cost of exploiting these resources, because they are located in ultradeep waters and global oil prices, will dictate the pace of future E&P investment sums.


Oil and gas companies in Latin America and the Caribbean have asked the governments of the region to maintain investments in the energy sector irrespective of the global economic situation, reports, quoting Infolatam. Representatives of 30 energy companies of the region stated that investments are vital in order to avert a collapse in energy supplies during the next 15 years. COMMENT: Which companies would invest these days and how much? It is clear that the investment needs of Latin America are huge and cannot be serviced by state-owned energy companies. As long as regulatory, political and economic uncertainty continue to be the rule in many countries of the region, there is little hope that investment flows will increase.


Energy regulator Creg announced the the regulated wellhead price of gas from La Guajira department, located in the northeast of the country where the biggest gasfields of Chuchupa and Ballena are located, will fall by 33.3% to $3.31/MMBtu from $4.97/MMBtu. “Since the price of oil hinges on heavy fuel oil prices and has retreated in the previous months, we expect a large fall (in wellhead prices) during the first half of 2009,” said Creg director, Molina Valencia.  COMMENT: Wellhead prices in Colombia reflect a better pricing policy than in countries such as Peru and Argentina, where they stand at $1-$2/MMBtu and $2-$3/MMBtu, respectively. Cheap wellhead prices in the region have only fuelled consumption and depleted reserves.

These briefs can be reprinted as long as the source is cited.

If you have any feedback on today’s articles, or if there are energy industry stories you think should be covered, or need research assistance, please contact

No comments yet

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: