E-CL looks to increase LNG imports in Chile, prices to rise

Friday, August 2, 2013

Chilean power generator E-CL is looking to increase LNG imports via its GNL Mejillones terminal in northern Chile.

The firm is in negotiations with suppliers, however, the cost of new contracts will be higher than in the past, CEO Lode Verdeyen said on the company's 2Q13 results conference call.

For 2013, the largest generator on Chile's northern SING grid has secured four LNG cargos plus an additional half of a LNG carrier's cargo.

Start your 15 day free trial now!


Already a subscriber? Please, login

The GNL Mejillones terminal has a regasification capacity of 5.5Mm3/d of standard natural gas.

In June work was carried out on a US$200mn onshore 175,000m3 LNG (110Mm3 of standard natural gas) storage tank which is expected to be completed in early 2014, doubling the terminal's storage capacity and allowing for larger LNG carriers (165,000m3) to offload.

Chile's state miner Codelco is developing a US$758mn 780MW Luz Minera gas-fired power plant project and mining giant BHP Billiton (NYSE: BHP) is developing the US$400mn, 540MW Kelar project near the LNG Mejillones terminal in region II, which stand to increase natural gas demand in the north.

Not accounting for any regasification capacity expansions, the terminal operator forecast available capacity of eight 2.9TBTU (140,000m3) slots in 2014, nine slots in 2015 and one slot in 2016.

E-CL is controlled (52.77% interest) by French energy major GDF Suez, which is looking to increase its participation in Latin America's retail LNG market.

In central Chile, generator Endesa Chile expects to finalize negotiations with BG (LSE: BG) soon for LNG supply contracts at the GNL Quintero terminal, after signing a preliminary revision of the 2007 LNG contract in early June, CFO Fernando Gardeweg said on the company's 2Q13 conference call.