El Niño, hydropower and Colombia's growing reliance on LNG

Colombia reported a 5% year-on-year rise in natural gas demand in April as the El Niño weather phenomenon continued to spur demand from thermoelectric power plants, new figures show. 

Volumes of gas delivered to final users via the SNT national pipeline network rose to 1,236BBTU/d (billion British thermal units a day) from 1,177BBTU/d in March, according to a report published by Colombian gas market operator BMC.

The thermoelectric segment consumed 513BBTU/d in April, up from 462BBTU/d the previous month, as the El Niño drought parched hydroelectric dams and forced the country to rely on standby plants running on gas, coal and liquids. 

Industries were the next biggest users, consuming 275BBTU/d compared to 265BBTU in March, while households used 178BBTU/d, up from 172BBTU/d. 

Next were refineries with 141BBTU/d (down from 144BBTU/d), natural gas vehicles with 60BBTU/d (up from 57BBTU/d) and retailers with 52BBTU/d (up from 49BBTU/d). 

Other consumers included compressors (9BBTU/d) and the petrochemical segment (8BBTU/d).

Atlántico department, on the northern Caribbean coast, was the biggest user, followed by Bolívar, Santander, Valle del Cauca and Bogotá.

Meanwhile, the volume of natural gas injected into pipelines was 1,388BBTU/d, up from 1,330BBTU/d in March, according to BMC.

The Spec regasification terminal in Cartagena, Colombia's only LNG import facility, delivered 412BBTU/d to users via the SNT compared with 357BBTU/d the previous month. 

Gas prices on the primary market under the firm modalities – which together comprised 71% of total contracts – averaged US$5.65/MBTU (million British thermal units) in April.

The median price under the option modality was US$14.14/MBTU while interruptible contracts were valued at US$6.57/MBTU.

The number of contracts negotiated on the secondary market reached 508 in April, up from 410 a month earlier. 

Average secondary market prices, meanwhile, were lowest in the "purchase option" modality at US$6.89/MMBTU and highest in the interruptible category at US$9.71/MMBTU. 

The full report, in Spanish, can be seen here.