CAF and OLADE sign agreement to promote energy integration in South America

The following is a machine translation of a CAF release

CAF, Development Bank of Latin America and the Caribbean, and the Latin American Energy Organization (OLADE) are pleased to announce the signing of a Technical Cooperation Agreement to promote energy integration in the countries of MERCOSUR, Bolivia and Chile. This agreement, which consolidates the collaboration between both institutions, aims to contribute to a fair energy transition based on the use of gas resources through the optimization and expansion of the natural gas transportation infrastructure .

Current and future challenges in the region

In recent decades, the energy landscape has evolved with the incorporation of new sources of supply and liquefied natural gas (LNG) regasification technology in Chile, Argentina and Brazil. The development of unconventional fields, such as the Vaca Muerta formation in Argentina, and the development of hydrocarbon resources in deep waters in Brazil, have opened up new opportunities and challenges in the energy sector. In addition, since the 2000s, the global development of the LNG market has driven the installation of regasification plants in Chile, Argentina and Brazil in the region to ensure a constant energy supply.

This alliance with OLADE allows us to join forces to create a more robust and efficient energy network that benefits all countries involved.

Antonio Silveira

"Regional energy integration is a fundamental pillar for the sustainable development of Latin America. This alliance with OLADE allows us to join forces to create a more robust and efficient energy network that benefits all countries involved," said Antonio Silveira , CAF's Physical Infrastructure and Digital Transformation Manager.

For his part, the Executive Secretary of the Latin American Energy Organization (OLADE), Andrés Rebolledo Smitmans , highlighted: "At OLADE, we are proud to formalize this cooperation agreement with CAF. This strategic alliance marks a milestone in our commitment to promote energy integration in the countries of MERCOSUR, Bolivia and Chile. This agreement not only strengthens our inter-institutional collaboration, but also underlines our shared vision of moving towards a fair and sustainable energy transition."

This agreement not only strengthens our inter-institutional collaboration, but also underlines our shared vision of moving towards a fair and sustainable energy transition.

Andres Rebolledo Smithmans

The regional gas integration project promoted by CAF and OLADE will seek to create a regional gas balance that optimizes the use of existing and planned infrastructure. In addition, work will be done on regulatory convergence scenarios that allow for strategic planning appropriate to the energy and economic needs of each country, in order to overcome historical barriers and move towards a more equitable and inclusive integration, allowing all countries in the region to benefit from an efficient and secure energy network .

The work will be divided into 5 phases, each of which will culminate in an in-person validation and consensus session by the relevant actors: (i) review and consolidation of available studies, (ii) preparation of supply and demand projections, (iii) optimization of existing infrastructure, (iv) optimization with new infrastructures and (v) preparation of project profiles.

Natural gas will play a crucial role as a transition energy, allowing us to reduce emissions while ensuring access to reliable and affordable energy for all.

Jorge Srur

"This agreement marks a milestone in our commitment to a fair and inclusive energy transition. Natural gas will play a crucial role as a transitional energy, allowing us to reduce emissions while ensuring access to reliable and affordable energy for all," said Jorge Srur , CAF's Southern Regional Manager.

The signing of the agreement took place in Asunción, Paraguay, within the framework of the IX Energy Week, a meeting that brings together the main regional energy players to discuss the challenges and opportunities in the transformation of the sector.