08/24/2024 – 20:35
The federal government is preparing a decree to change the rules of the natural gas sector in the country. The objective is to increase the supply of the product and reduce prices by 35% to 40%, an old campaign that has been pursued by several governments, but without success.
The expectation is that the package will be announced next Monday, the 26th, after a meeting and approval of the measures by the National Energy Policy Council (CNPE). The information was first released by the newspaper Economic Valueand confirmed by State.
According to a draft of the decree to which the State had access, there will be four measures that are considered main by the government.
The first will allow Brazil’s National Agency for Petroleum, Natural Gas and Biofuels (ANP) to have instruments to establish a price ceiling for the use of gas pipelines that carry gas from the high seas, where it is extracted, to the Brazilian coast. The agency will have to collect information on the costs and investments amortized by these pipelines, in order to then define the maximum remuneration for use.
Today, there is a complaint among large gas consumers that Petrobras uses the opportunity cost of selling the product as a parameter. As a result, the oil company sets the price based on Liquefied Natural Gas (LNG), which arrives in the country by ship and has a higher cost.
In parallel, the government is studying a measure so that the state-owned company Pré-Sal Petróleo (PPSA) can compete with Petrobras in the sale of gas, also accessing systems for the flow and processing of the product. In practice, the Union will have its own arm for the direct sale of the product, without depending on Petrobras, a mixed-capital company, despite the federal government being its controlling shareholder.
In addition, measures will be created to reduce the reinjection of natural gas into offshore oil wells. This practice is in the interest of oil companies because it increases pressure in the fields and makes oil extraction easier, but it also means the loss of this gas, which is not recovered. By limiting reinjection, the government wants this gas to reach Brazilian consumers on land.
A fourth measure considered essential by the government is the creation of the Natural Gas Sector Monitoring Committee, which will be separated from the Electric Sector Committee, to have greater autonomy and action. The details of the project are still in the final stages of preparation, so the text may undergo changes.
Consumers have a positive view
Today, the cost of natural gas in the country is around US$ 14 per million BTUs. According to the CEO of the Brazilian Glass Industry Association (Abividro), Lucien Belmonte, the expectation is that the measures could reduce the cost by 35% to 40%, that is, to something around US$ 8.5 or US$ 9.0.
He considers, however, that the text that circulated in the sector is still a draft, and that a careful analysis of each of its articles needs to be carried out.
“We still need to wait for the details, because they make a difference, but what has come out so far is in line with what major consumers wanted. It is a way to boost the market and increase competitiveness in the gas market,” he said.
Belmonte points out that this will be the third plan, in three different governments, to try to reduce the price of gas in Brazil. During the Temer and Bolsonaro governments, there were also attempts, but without the price actually being reduced.
For the president of the Association of Large Energy Consumers (Abrace), Paulo Pedrosa, the measure goes in the right direction.
“Bringing more transparency to access to essential infrastructure is a very positive move that restores the Gas Law. It promised a large, competitive market and has yet to deliver. It allows for optimism and joins other initiatives to increase the supply of gas and reduce emissions from Brazilian industry,” he said.
Gas fueled dispute between Prates and Silveira
The reinjection of gas by Petrobras was one of the points of friction between the Minister of Mines and Energy (MME), Alexandre Silveira, and the former president of Petrobras, Jean Paul Prates. Silveira even publicly demanded the president to explain the reinjection of gas by the company. Prates, in turn, always claimed that there were technical justifications.
“Between pleasing Jean Paul and fulfilling the government’s commitment to Brazilian society, to generate employment and combat inequality, I prefer that he stays silent, but that we can achieve success in public policy,” said the minister in June of last year.
A few days later, Prates responded, also publicly. “There’s no point in just shouting in the newspaper, or thinking that one person is laughing too much and the other is making a face. There’s no point in either smiling or making a face; there’s no point in working together and converging,” he said during a press conference at the National Bank for Economic and Social Development (BNDES) alongside the bank’s president, Aloizio Mercadante. “If there’s not enough gas for all segments, let’s work on the mix (of energy supply) instead of creating controversy where there isn’t any.”
When contacted, the Ministry of Mines and Energy did not respond to the reporter’s questions.
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