Oil & Gas - Colombia

LNG import policy needed by 2015 - Colinversiones chief

LNG import policy needed by 2015 - Colinversiones chief

By -

LNG import facilities in Colombia need to be developed within the next four years, according to the president of Colombian power investment group Colinversiones, Juan Guillermo Londoño.

"Import plants would give security in moments of peak electricity demand. I think that before 2014-15 Colombia needs to have import facilities either constructed or expected," Londoño told BNamericas on the sidelines of the FISE power conference in Medelíin.

The possibility of gas imports has long been advocated in Colombia as an important backup to the country's hydro-dependant power matrix. Colombia's power and gas regulator Creg is currently designing regulation for the development of future import facilities.

Londoño confirmed that Colinversiones is part of a group of generators currently involved in studies.

"At the moment there is a group of generators looking at sites on the coast, around Cartagena and others in Buenaventura. We are working with international companies that are present here as well, [though] these plans are only in a pre-feasibility stage," Londoño said.

GAS EXPORTS

In May, Canadian oil firm Pacific Rubiales announced plans to develop the country's first LNG export plant, in order to ship excess output from its La Creciente field to markets in the Caribbean where it could fetch better prices.

Exports have only recently been enabled by the Colombian government, under pressure from companies which operate in the country. Under the new regulations, gas exports will be permitted as long as potential production capacity exceeds total current demand. The country has a gas reserve horizon of at least eight years.

Londoño says that Colinversiones and generators in general back the plans on the basis that they will encourage greater investment in gas production and thus increase supplies in the long run.

"It's a good policy by the government, and we support it. The size of the Colombian market is small, and the investments that need to be made to extract that gas are quite large. When you open the market to exports, that is going to stimulate investments that release more gas for the country," he said.