Argentine gas crisis expected to be more severe in 2008 than 2007

Energy experts in Argentina warn that the government of the country needs to urgently re-evaluate its energy policy in order to avoid future shortages and to assure supply over the long-term.
Argentina’s former Energy Secretary, Jorge Lapena announced that “the first thing that the government must do is suspend the tender for the Gas Pipeline of Northeastern Argentina (GNEA by its Spanish acronym) until it is certain how much natural gas will be available to be shipped along the pipeline.”

Lapena added that the government of Argentina should renegotiate the time line for the construction and completion of the GNEA until it could obtain guarantees that Bolivia would make the necessary investments in its hydrocarbon sector to guarantee it has sufficient natural gas production available for export to Argentina along the GNEA.
Lapena added that the government also needed to step up its studies related to the possible importation of liquefied natural gas (LNG) while also implementing a new exploratory phase aimed at increasing Argentina’s natural gas reserves and production.

“The energy situation in Argentina is very serious and the government should study the existence of natural gas in the Patagonia,” said energy specialist Francisco Mezadri. “Furthermore, instead of trying to cover the natural gas shortages with liquids, the government should study the LNG option which obviously requires large investments in plants and ships and requires long-term agreements with suppliers.”
Mezadri added that “another alternative to reduce the consumption of natural gas would be to revert to using coal-fired power stations.”

Argentina’s former Energy Under-Secretary, Gustavo Callejas, warns the natural gas restrictions in 2008 will be more intense than in 2007.
“Argentina cannot count on natural gas to come from Bolivia via the GNEA,” Callejas emphasized. “Besides, the production of natural gas in Argentina is well below the transportation capacity of the country.”