How Bolivia will transport Argentine gas to Brazil

Bolivia is ready to transport Argentine gas to Brazil through its pipelines.

The Andean nation tweaked its regulatory framework to permit national oil firm YPFB to transport, buy and sell gas produced beyond Bolivia’s borders. 

Bolivia will initially offer to Argentine producers 4Mm3/d (million cubic meters per day) of capacity along a 1,000km stretch of interconnected ducts.

“The [international transport system] SIT is in operational and regulatory conditions to receive gas in transit,” YPFB’s director of natural gas export contracts, Julio César Solíz, said in a presentation.

“Bolivia opens a window of opportunity for gas in transit for delivery to Brazil, from this month and indefinitely.”

YPFB will initially engage in transport work but, in a second phase, could also start to buy and sell gas produced elsewhere, Soliz told a webinar hosted by Argentine gas trading platform Megsa.

Four Argentine producers – Tecpetrol, Pluspetrol, Pan American Energy and Total Austral – have sought the green light from Buenos Aires to dispatch production to Brazil via Bolivia. Combined authorizations – which are on an interruptible basis – are for 6.3Mm3/d.

With 32Mm3/d of transport capacity, the infrastructure comprises the 48km GIJA international link, connecting Salta province to Bolivian region Chaco, as well as the Yacuiba Río Grande (GASYRG, 432km) and Gastransboliviano (GTB, 557km) ducts. The system ends in the Bolivian locality of Mutún, across the border from Brazilian state Mato Grosso do Sul.

Pipeline capacity, available to Argentine producers for fixed terms, could eventually climb to 10Mm3/d, potentially in 2025.

Capacity could be increased “without major complications” next year,” Soliz said. “This new capacity will be available to all interested parties.” 

Gas could also be piped further north via the Gas Oriente Boliviano (GOB) pipeline of 362km that branches off from GTB.

In terms of monetization, YPFB would charge either buyers or sellers a fee, of around US$2/MMBTU (million British thermal units), comprising a component for securing pipeline capacity and a component established by regulator ANH, for transporting the hydrocarbon.

In Argentina, regulatory work is pending, such as establishing south-north transport rates on the Gasoducto Norte duct, the webinar heard. Customs coordination work is also needed.

Argentina also needs to complete flow-reversal work on the Gasoducto Norte pipeline, which will permit the dispatch north of Neuquén basin gas.

First-phase work should conclude this quarter, permitting a flow of up to 5Mm3/d with south-north capacity available due to climb to 19Mm3/d by the end of March 2025 following completion of a second phase.

Flow-reversal work will allow Argentina to substitute firm imports of Bolivian gas, which ceased in September, and increase capacity to export to Chile – currently the biggest buyer of Argentina gas – and Brazil.

For now, Argentine gas would only be transported through Bolivia and not consumed in the country, whose domestic production has been trending down since 2015.

Exports of Bolivian gas to Argentina started trending down around 2017, when levels of just under 18Mm3/d were registered. Over the past two decades exports averaged 10.9Mm3/d.

Argentine gas production is around 153Mm3/d. Shale output in the Neuquén basin’s Vaca Muerta formation climbed 23.1% year-on-year in August to 83.5Mm3/d, according to data from local consultancy Economía & Energía.