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Brazil's gas find heralds a 'golden age'

May 1, 2012 at 5:49 AM   |   Comments

RIO DE JANEIRO, May 1 (UPI) -- Brazil says natural gas finds on land herald a golden age of the energy resource and will likely reduce dependence on gas imports from Bolivia.

Brazil, like China, has seen energy consumption soar with industrialization and household consumption of energy increase with rising living standards, at least in some urban areas.

Brazil is battling crushing poverty affecting millions of its citizens, great disparities in household income and sprawling shanty towns in the midst of high-rise pockets of plenty.

Poor or rich elite, Brazilian households are using more energy with greater dependence on domestic appliances bought with ready cash or easy credit. This raises the prospect of a continuing spiral of energy use, analysts said.

The latest gas find means Brazil can look to attaining self-sufficiency within five years, Mines and Energy Minister Edison Lobao said.

"Brazil is ready to live a natural gas golden era" with self sufficiency in five years, Lobao declared, echoing an International Energy Agency prediction the world will soon move into a "golden age of gas."

Both Lobao's declaration and IEA assessment are based on a prognosis that gas is the energy of a cleaner future.

Brazil's National Petroleum Agency cited statistics to argue that Brazil will soon have access to natural gas reserves on land that are likely to increase supply by 360 percent in the coming decade.

Translated into production volumes, Lobao's statement means Brazil's current production of 2.6 billion cubic per day could reach 10.6 billion cubic feet by 2027.

ANP says it has identified 28 sedimentary basins on land with natural gas potential that can halve the country's gas imports from Bolivia.

Currently most of Brazilian gas production is derived from offshore wells in deep-water areas of the South Atlantic. Of a current daily consumption of 3,037 million cubic feet, Brazil imports about one-third from Bolivia.

Brazil is also helping Peru to develop its gas industry. Brazilian construction firm Odebrecht, Petrobras and chemical firm Braskem together plan to spend $5 billion on building a pipeline and related infrastructures for bringing Peruvian gas into the market.

Petrobras says it expects to find 8 trillion-10 trillion cubic feet of natural gas in Peru's Camisea fields under exploration and development.

Construction on the first part of a pipeline from the fields will start in June and be completed in 2014, Odebrecht Peru General Manager Jorge Barata said. The final stretch of the pipeline to the southern Tacna region, 22 miles north of the Chilean border, is planned to be operational by 2020.

Barata said that as part of the first phase the pipeline will be extended to the mainly agricultural town of Quillabamba where a power plant will be built. At present Quillabamba's economy depends on coffee, cacao, tea and coca plantations but that is likely to change when the gas pipeline becomes operational.

Braskem has said it plans to build a major petrochemical plant in southern Peru to cater for local needs and export customers.

Both Braskem and Petrobras say their projects are very much tied to the pipeline materializing as indicated.

© 2012 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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