Regardless of exponential progress in deepwater subsalt fuel production in Brazil over the last ten years, the nation’s home market has not been able to benefit from this bonanza, market observers say.
Rising subsalt fuel production helped to spice up Brazil’s overall gas production by 90% from 2008-2018, based on the nation’s National Petroleum Agency (ANP). However, the sale of domestic fuel increased merely about 50% as operators had been unable to bring gas onshore, as a substitute reinjecting it into the deepwater fields, based on the ANP.
Brazil produced 3.88 Bcf/d of fuel last year, half from subsalt fields. In 2017, the nation’s total domestic fuel sales totaled 2.68 Bcf/d. Excluding imports, domestic production shipped merely1.65 Bcf/d to the market. Most of the gasoline produced in Brazil’s subsalt fields was reinjected because of the inability to carry it onshore, stated Jose Firmo, director of the Brazilian Petroleum Institute, the nation’s hydrocarbons trade association. ANP information additionally reveals upstream fuel reinjection in Brazil grew 176% to about 1 Bcf/d over the past ten years.
“Further access to subsalt natural gas may help create an industrial revolution in Brazil like the one witnessed within the US,” Firmo mentioned. “The US suffered from an industrial exodus to Asia in latest decades. Still, the USA was in a position to increase industrial operations by 9% recently due to low-priced natural gas.”
In accordance with Firmo, US unconventional shale manufacturing elevated the fuel production by 51% while slicing spot prices in the nation by 64%.
The office of President Jair Bolsonaro formed Monday an active government group to counsel a roadmap to extend fuel supply into Brazil’s home market and bring better competitors into the sector. The federal government wishes to see an end to state-led Petrobras monopoly over the gas market. Petrbobras retains 100% of the capacity at many trunk pipelines and possession over the state gas distribution corporations.