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Sunday, September 25, 2022

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Supply of fuels at the mercy of the sea

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The scarcity of LPG by abnormal waves is already an old acquaintance. With this, it would be the third crisis that has worsened the sector so far this year, with the trigger that, unlike jet fuel (also the protagonist this week), it hides a relatively simpler solution for the population.

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80% of the LPG produced in Peru is fractionated in Pisco, coming from the Camisea deposits. In turn, nearby Lima, located 246 kilometers from the pluspetrol, concentrates more than 70% of national consumption. Being, then, an LPG what is clearly brought, the route should be covered by tubes (to give an example, the Norperuano Pipeline has an extension of 1,106 kilometers). But he does it by ship.

Gustavo Navarro, former director of the General Directorate of Hydrocarbons, recalls that Proinversión once handled the construction of the pipeline in its portfolio, but, given the disinterest of the private sector and a model that has not allowed the State to guarantee its own energy security throughout this time, was set aside. However, the first step was taken by the private company, in 2004.

gym had the initiative to build a pipeline from Pisco to Callao, without state intervention. They did the project, but it required a volume guarantee, that is, signing a contract with producers or buyers that guaranteed that they would use the tubes. Pluspetrol, which at that time was bringing LPG to Lima by ship, did not want to sign anything and frustrated all the financing”, he points out.

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The problem cannot withstand further delay because there are more and more abnormal waves on our coastline, as a result of climate change, and that is a tangible fact. According to a recent Petroperú report, only up to June of this year, 27 closures of the Talara Liquid Loading Dock (MCL) were registered, accumulating a total of 111 days without operating. A situation that is replicated throughout the coast, from Tumbes to Arequipa, with increasing frequency.

According to official statistics, from 2002 to 2017, the total closures of ports in Peru have been increasing, almost fivefold in the last decade of study. A figure that has now been largely surpassed and for which it will probably not be the last time you have to queue for LPG this year.

“Since then, an attempt has been made to put the work out to tender again, but due to the refusal of the producers, no progress could be made. The pipeline was supposed to bring 18,000 barrels of LPG per day (more than what Lima consumes today)”, Navarro points out.

Harmful contracts

Aurelio Ochoa Alencastre, a specialist in energy issues, goes further and points out that the construction of this vital infrastructure for energy security must be part of the Camisea gas renegotiation.

Camisea, in the heart of La Convencion, is not only the largest source of natural gas for Peruvians: it also provides the liquids to produce LPG. Liquids that just travel to Pisco to be “fractionated”, processed and shipped to Lima, at the mercy of the rough sea. But Ochoa detects vices in this circuit.

“The State cannot renounce its obligation to ensure the energy security of the country. It can calmly get strong and force the consortium to make the construction of the pipeline viable as soon as possible. This should be one of the points in the renegotiation, of which nothing has been done, ”he points out.

In addition, he points out that, even with the pipeline, the infrastructure would not be complete if storage capacity is not guaranteed. The former president of Perupetro explains that, When the regulations for selling LPG were drawn up, back in 1994, a contingent reserve of at least 15 days was required in case of an emergency. However, since the private sector was unable to do so, the deadlines were reduced to what we have today, 3 days.

Only Petroperú made an effort to comply, building three spheres in Talara and renting two ships as these in Callao. Vain investment, everything returned to zero pages.

“When situations like this arise, private business cannot prevail over collective interest. And in this case, the international increase in oil has been added, it has rained on wet”, concludes Ochoa.

Radiography of the LPG market in Peru

In May, the demand for vehicular LPG at the national level was 24,295 barrels per day. Only Lima occupied 11,512.

LPG in Peru is sold at international prices, despite the fact that 80% is produced here. That is, the 20% imported defines the market prices.

LPG is brought to Callao by ships that have long-term contracts with Pluspetrol.

Experts agree that the passport to energy security in Peru is the widespread use of natural gas, which has a regulated price from Lot 88. Although the LPG infrastructure and its supply must be improved, Peru’s alternative is gas from Lot 88. 88.

The more consumers who have natural gas, the fewer consumers of LPG. An emancipation from international oil prices.

Infographic The Republic

Infographic The Republic

spheres. LPG storage capacity is scarce.

Source: Larepublica

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