Colombia sets timetable for US$700mn Pacific LNG tender

Bnamericas Published: Thursday, July 02, 2020
Colombia sets timetable for US$700mn Pacific LNG tender

A contract to build and operate Colombia's second LNG import terminal will be awarded next April as part of government efforts to avoid a looming gas shortage.

The presentation of financial and technical proposals has been slated for February 17, with counteroffers to be submitted on March 23, according to newly released energy ministry documents. 

The winning technical proposal will be announced on April 6 while bid envelopes for economic offers will be opened six days later.  

The dates were established in draft tender guidelines, which are available for public consultation until July 17. Final bidding and contract terms will be published on July 30. 

Earmarked for the port of Buenaventura on Colombia's Pacific coast, the proposed new LNG terminal is expected to regasify up to 400Mf3/d and store 170,000m3 of gas.

The project includes an associated pipeline connecting the facility to Yumbo, near the southwestern city of Cali.  

Overall investment in the new infrastructure is forecast to reach US$700mn, according conceptual studies conducted by energy ministry planning unit UPME

In May, energy minister Diego Mesa said the project was on track to be completed in early 2024 – six months later than previously planned – and just in time to address an expected natural gas deficit in Colombia.

However the initiative has drawn opposition from some local producers, who fear they won't have a market for their gas. 

There have also been concerns about how the government will implement a tariff structure that is fair to investors, transporters and consumers. 

In answers to queries submitted in a previous public consultation for the project, UPME said the storage and regasification unit could be built either onshore or offshore.

UPME's responses – outlined in a 400-page document published on Tuesday – also highlighted that engineering, procurement and construction contracts will be the responsibility of the winning bidder.

Colombia's first LNG regasification plant – the SPEC facility near the Caribbean city of Cartagena – began operating in 2016. 

In June, energy policy advisor Alejandro Lucio told BNamericas that Colombia's increasing reliance on gas-fired thermopower as a backup for hydroelectric plants has made LNG vital to the country's energy security.

In addition to serving thermoelectric generators, Lucio said the Pacific LNG project would help meet rising demand from industries, households and the transport segment in Colombia's southwest. 

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