Energy Advisor 2023-06-30 – Inter-American Dialogue

LATIN AMERICA ADVISOR

Energy ADVISOR

A daily publication Of the dialogue

June 30, 2023

Will Venezuela Soon Be Able to Export Natural Gas?

Venezuela’s government recently reached deals with Repsol and Eni to increase natural gas production in the country. Repsol’s Perla project is pictured. // File Photo: Repsol.

Q

Venezuela’s government has reached agreements with Spain’s Repsol and Italy’s Eni to increase natural gas production from their operations in the South American country and export the commodity to Europe, Bloomberg News reported in mid-June. At the same time, Venezuelan officials are seeking international certification for the country’s gas fields. How likely is Venezuela to start exporting natural gas, and how soon could that happen? How much investment would be needed in order to turn Venezuela into a natural gas exporter? How likely are factors such as Venezuela’s history of expropriations and sanctions against it to scuttle any possibility of it exporting gas?

A

Michael C. Lynch, president of Strategic Energy & Economic Research and distinguished fellow at the Energy Policy Research Institute: “The natural gas price spike in 2022 resulting from the drastic reduction of Russian pipeline exports to Europe has increased interest in the liquified natural gas (LNG) industry, which many already feel will play an important role in the anticipated energy transition. With natural gas reserves of 220 trillion cubic feet, the second largest in the Western Hemisphere, and better proximity to European markets than the Middle East, Venezuela is well placed for a new LNG export project. Development of the natural gas fields and even a modest LNG plant (such as one with capacity of six million tons) would cost between $4 billion and $5 billion, but it could easily yield $3 billion to $4 billion a year in revenue, even if 2022-level gas prices do not…”

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ABOUT THE Energy ADVISOR

A sister publication of the Inter-American Dialogue’s daily Latin America Advisor, the weekly Energy Advisor captures fresh analysis from business leaders and government officials on the most important developments in oil and gas, biofuels, the power sector, renewables, new technologies, and the policy debates shaping the future of energy in the Western Hemisphere and beyond. To subscribe or for more information, contact Gene Kuleta, editor of the Advisor, at gkuleta@thedialogue.org.