Will there be a market for the Falkland gas?
From Upstream November 6
ENERGY BORDERS are falling across Latin America, creating opportunities from wellhead to end-use markets for both large and small upstream companies. South America is transforming into an integrated energy market. Privatization of many former state monopolies is enabling private companies to take the lead in countries right across the continent.
Considering the region's severe energy deficit, "the gas marketing opportunities are quite mind-boggling", Shell International Gas business development manager Enrique Morales told Global Pacific's Latin upstream conference in Miami.
Political stability, market liberalization and deregulation are also contributing to competitive, integrated energy markets, said Buenos Aires-based Pluspetrol Exploration & Production international negotiations manager Francisco Pulit.
He said economic growth in South America, which averaged about 4.5% from 1993 to 1996, is expected to average about 4.3% through to 2006. Energy demand is expected to grow even faster.
Gas-power integration in the "Southern Cone" countries (Brazil, Argentina, Uruguay and Paraguay) is shaping Bolivia and northern Argentina into a regional gas hub with proven reserves of 12 trillion cubic feet and deliverability of about 1 billion cubic feet per day, Pulit said.
Shell's Morales estimates that gas demand in Brazil alone could reach more than 2 Bcf per day by 2005 from about 500 MMcf per day now "and will continue increasing thereafter". Much of the pipeline infrastructure needed to expand markets is being developed, he added.
Morales said that Shell aspires to becoming "the pre-eminent and most competitive gas player in Latin America by 2010".
SHELL'S upstream spending in South America could top $1 billion in the next five years with a hefty chunk of it going to projects that were believed to be off its drawing board. The company has in the last three years acquired interests in exploration and development acreage, oil and gas transportation assets, and hydrocarbon-fuelled co-generation projects in more than half-a-dozen South American countries. |
