2018: South America readies pipeline calls

Thursday, January 4, 2018

A number of procurement calls to advance development of natural gas and oil pipelines in South America are due to be issued this year as authorities look to increase capacity and overhaul existing transport infrastructure.

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Growing production and offtake, more stringent operating requirements and new supply sources are some of the drivers behind the planned expansion and revamp of the region's ducts, in particular those in Peru and Colombia.

After the termination of the Sur Peruano natural gas pipeline (GSP) concession last January, Peru's government transferred GSP assets to an interim administrator and tasked investment promotion agency ProInversión with preparing a process to hire a new concessionaire.

GSP, which is 37% complete, was rebranded as Sistema Integrado de Gas Natural del Sur.

Tentative southern Peru pipeline route (SOURCE: ProInversión)

ProInversión is currently updating information, such as investment and qualification requirements, in the lead up to the tender to complete and operate the pipeline which will stretch approximately 1,100km and transport Camisea gas to the south of the country.

Side picture: Inventory of GSP assets (CREDIT: Osinergmin)

Another bidding opportunity in Peru is the modernization of the Norperuano oil pipeline, which state oil company Petroperú envisions will be carried out through a special purpose vehicle due to the estimated pricetag of US$800mn.

The NOC has a confidentiality agreement with Techint to define this project's scope and a possible partnership.

SOURCE: Petroperú


Colombia's plan to increase gas supply through a second LNG import terminal includes construction and operation of a pipeline that will connect to the regasification plant.

According to preliminary information, the 102km, 30-inch diameter Buenaventura-Yumbo line would have capacity to transport over 450Mf3/d. Estimated investment is US$160mn.

Mining and energy planning unit UPME plans to open the investor selection process this quarter and award the contract in 4Q18.

Tentative Buenaventura-Yumbo route (SOURCE: UPME)


Reports from Ecuador reveal that Oleoducto de Crudos Pesados (OCP), which operates one of the country's two oil pipelines, is in talks with the hydrocarbons ministry to return the duct to the state this year versus November 2023.

OCP, which transports heavy crude, will be used more than the Petroecuador-run SOTE pipeline, which moves light crude, due to a greater contribution of heavy crude as a result of block 43 operations, local press quoted minister Carlos Pérez as saying recently.

Although initial plans would have the state operating OCP, a move by the government to court private investment could result in the search for a new operator.

At the consultancy level, feasibility work may be put out to bid for a planned gas link between Bolivia and Paraguay, following the signing of a hydrocarbons cooperation MOU in 2017 between both nations.

For a look at other planned pipelines in the early stage across Latin America, check out the BNamericas Project Profiles Database which includes: