Time to give a gas in Brazil

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The Chamber of Deputies dispatched a bill that aims to promote the natural gas (NG) industry in Brazil. Approved, after being processed for more than five years, by a large majority of 351 deputies, with only 101 votes against, the bill received the support of the federal government and companies in the sector, in a great convergence.

The project breaks the monopoly that was created over time by Petrobras in Brazil. It opens up the market for other companies, by replacing the concession regime – established by Law No. 9,478 / 97, which did not have the expected success – by the authorization regime.

The result of this policy was an insufficient pipeline network both to meet the country’s potential demand and to provide gains with the increase in the supply of NG, which is the cleanest of fossil fuels and an abundant and cheap energy source, of great utility. Its consumption ranges from the use in the kitchen of Brazilian homes, through the industry and reaching the generation of electric energy.

Today, the national network of transport pipelines is only about 9,500 kilometers long, compared to the existing 16,000 kilometers in Argentina, to give a close example. Here natural gas accounts for 13% of the energy matrix, compared to 22% of the world matrix, according to data from the Energy Research Company (EPE).

The replacement of the concession regime with that of authorization will give more speed to investments, as it is a less bureaucratic process and more favorable to attracting private investments. Freedom of access to the gas pipeline network, as well as other mechanisms included in the project, will give investors the necessary security to undertake. And this is the central idea of ​​the text: to attract private investments to the sector and let the natural gas market grow organically, without depending on public investments, which are currently insufficient.

Companies with an interest in the sector are beginning to move in anticipation of the new law. The specialized press reported that Spic Brasil, a subsidiary of China’s State Power Investment Corporation, recently signed a contract to acquire 33% of the GNA I and GNA II thermoelectric projects, both under construction in Porto do Açu, in São João da Barra (RJ) ).

Spic also signed a contract to participate in future expansion projects that provide for the combined use of imported liquefied natural gas (LNG), and pre-salt gas, which are today the most viable and cheapest sources of energy. The complex includes a LNG terminal with a total capacity of 21 million cubic meters per day. The first plant, GNA I (1,300 MW), should start operating in the first half of 2021.

Transportadora Associada de Gás (TAG), Nova Transportadora do Sudeste (NTS) and Transportadora Brasileira Gasoduto Bolivia-Brasil (TBG) map routes and intend to build small strategic branches, estimated at R $ 630 million by EPE, which, in turn, time, it has already mapped investment potential of R $ 17 billion in 11 new projects.

The estimate is that the new law will provide investments between R $ 50 billion and R $ 60 billion and 4 million jobs in five years, in addition to reducing the price of fuel in half, which allows an increase of 0.5 percentage point growth in gross domestic product (GDP) per year in the next decade.

Brazil’s gas production is expected to triple by 2030, from the current 50 million to almost 150 million cubic meters / day. It will grow a lot with the exploration of pre-salt and cheap gas available in the world, coming from abroad by tubes or ships, in liquefied form.

All of this should make natural gas cheaper in Brazil, where prices are currently higher than abroad. According to the estimate of the Ministry of Economy, the price of gas can fall in half, for a range between US $ 4 and US $ 8 per million BTUs, compared to the current value that varies from US $ 12 to US $ 14.

The new Gas Law will have, for the country, an importance similar to that of the recently approved legal framework for sanitation and that of changes in the electricity, railroad and oil sectors, also underway in the National Congress. It will bring countless benefits to Brazilian society. In addition to private investments and the creation of the jobs mentioned, it will considerably reduce the price of natural gas, from household cylinders to the steel, ceramic, chemical, cement and glass products industry, making them cheaper and more competitive.

We will also have a reduction in the price of electricity: 23% of its generation currently uses NG as fuel, according to EPE. In the midst of the new investments, there will be gains in collection and environmental improvement: natural gas is the least pollutant of fossil fuels. Petrobras itself will benefit from the competition, as it will have to become more efficient to face it.

It is urgent that the Senate vote on the bill, whose benefits, I repeat, will be immeasurable for the country, helping us to get out of the difficult moment we are going through.

It’s time to give a gas in Brazil.



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