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On Thursday, February 1, Hon. Alfonso Blanco Bonilla, Executive Secretary of the Latin America Energy Organization (OLADE), presented the energy outlook for 2018 to the 2nd Latin America Energy Forum, organized by the Houston Energy Club.
OLADE is a public intergovernmental organization founded in 1973, composed of 27-member countries which are represented by their Ministers of Energy.
Hon. Blanco discussed the current situation in the energy sector in Latin America and the Caribbean, highlighting the fact that the total electricity supply per capita in the region has increased in the region, up to 3% over the past five years in the Southern Cone.
Petroleum remains the primary source of energy in Latin America, followed by natural gas and biomass.
Chile, Argentina, Brazil and Mexico are the largest importers and consumers of natural gas, while Trinidad and Tobago and Peru are the main exporters.
Chile relies primarily on liquefied natural gas imports from the United States and it has recently built several regasification plants along the Pacific Coast. Brazil also has 3 regasification plants in the Atlantic coast to import LNG.
Although there is only one operating LNG liquefaction plant in South America, which is located in Peru, the region has abundant natural gas resources, especially in Argentina, Bolivia and Brazil.
External energy dependency of Latin American countries from foreign sources has increased over the past 5 years, and energy demand in the region currently exceeds energy production.
Bolivia's geographical location is a key factor for the supply of the Southern Cone markets, and the country is already a main supplier of oil and gas to Brazil and Argentina.
Venezuela is the country with the largest proven oil reserves. However, such resources remain mostly unexploited due to the country’s financial crisis.
The Dominican Republic is becoming a hub for LNG distribution in the Caribbean with the construction of the Andres liquefied natural gas storage terminal, with the ability to supply neighboring countries through small LNG barges.
Argentina, with the development of its gas fields located in the Vaca Muerta region, and Brazil, with the Pre-Salt fields located offshore in the Atlantic Ocean, aim to be gas producers and enter an already competitive market. Bolivia has granted several exploration licenses to extract its natural gas resources in the southern region.
Hon. Blanco Bonilla forecasted that natural gas is the “energy matrix of the future, not just as a transitional fuel, but as a fuel with a predominant role in a sustainable energy matrix from an environmental point of view, but also from the dimensions of access to energy and energy security”.
He underlined that a key issue for the development of gas in the continent is the development of infrastructure, which requires public-private partnerships.
By Francesco Stipo for Oilprice.com
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Francesco Stipo is a lawyer, author and energy expert. He published several articles on energy and international affairs in American journals and newspapers and is frequently invited…