Colombia is moving forward with plans to build a second 400 MMcf/d LNG regasification plant to be located near its Pacific coast to assure adequate gas supplies, mining and energy minister German Arce has said.
Speaking Friday to business leaders in the southwestern city of Cali, Arce said such a plant was necessary to assure "reliability of supply" in western Colombia. The country is self-sufficient in gas, but with reserves in decline it may have to begin imports as soon as next year.
Colombia's first LNG regasification plant is under construction near Cartagena on the Caribbean Coast and will be operational by year-end. The $800 million facility will process up to 348 MMcf/d of gas, destined mainly to fuel thermo-electric power plants serving northern and central Colombia.
Colombia consumes about 1 Bcf/d of gas, all supplied from its rapidly depleting fields. Promising offshore fields being developed by state-controlled Ecopetrol and partners Anadarko and Repsol are not expected to enter production until 2022 at the earliest, assuming they prove commercially viable.
Arce did not give a target date for a construction of such a plant. But the ministry's planning agency, known by its Spanish initials UPME, has said that such a facility should be operational no later than 2024. However, thermo-electric power plant owners in the region want such a plant to be on line by 2020 at the latest, regulators have told S&P Global Platts.
Regulators have told Platts the second regas plant is likely to be built in or near Buenaventura, Colombia's largest Pacific Coast port city.
The regas plant near Cartagena is expected to import LNG from Trinidad and Tobago and the US. The Pacific plant may seek LNG from Peru or Asian LNG producers, sources have said.
How fast demand for imported LNG grows will depend in part on climate and rainfall levels. Normally, Colombia generates 70% of its electricity at hydro power facilities, but droughts caused by the El Nino weather phenomenon over the last year forced the country's electricity grid at times to use as much thermo-electric power as hydro.
Also boosting gas demand is the growing popularity of so-called hybrid cars and buses that use a mixture of gas and gasoline for fuel. The government is promoting such power sources as environmentally friendly.
