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LATIN AMERICA ADVISOR

LATIN AMERICA ADVISOR

A daily publication Of the dialogue

December 12, 6726

Why Is Colombia Facing Low Supplies of Natural Gas?

Colombia is turning to imports of liquefied natural gas because of dwindling gas supplies. Bogotá is pictured. // File Photo: Kevin Castañeda Villamil via Creative Commons.

Q

  • Colombian companies are bracing for higher energy costs as supplies of natural gas fall and the country turns to more expensive imports of liquefied natural gas, Bloomberg News reported June 5. The country’s gas reserves are currently at half their level of a decade ago, and state energy company Ecopetrol is expecting a widening gap between gas supplies and demand until underwater deposits of gas start meeting demand in about 2030. What are the main reasons behind Colombia’s dwindling supply of natural gas? How serious is the growing gap between supply and demand for consumers and businesses, and which sectors will be most affected? What should Colombia do to increase domestic gas supplies?

A

Francisco Jose Lloreda, former minister of state and president of the Colombian Petroleum Association: “Colombia faces an energy paradox. It has natural gas but a domestic supply shortage is still expected. According to Ecopetrol, the country will run short of gas between 2025 and 2030. Since 2017, its proven reserves have declined. The striking fact is that the country has had options. Colombia relied for decades on gas from shallow waters in northern Guajira and since the 1990s from associated gas in the eastern plains. But both sources are declining, leaving the country with four options: unconventional gas (although the government banned fracking), contingent gas resources from offshore (which at best will be commercial at the end of the decade), imported LNG (by expanding the regasification facilities in the Caribbean; the one projected in the Pacific has not…”

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