The main thrust of the proposal is to limit the regional differences in natural gas prices by bringing the price of Bolivian gas down, closer to the price of domestic gas, according to Rogerio Lima, CFO of Santa Catarina distributor SCGas.
Abegas wants the government to reintroduce a price cap that would limit the variation of natural gas prices to those of fuel oil prices, he told BNamericas. It wants the government to convert natural gas commodity prices into Brazilian reais, based on the prices set in the original supply contracts of about US$0.95 per million British thermal units (mBTU), and not at today's price of about US$1.68/mBTU.
The transport price should also be converted into reais, he said, adding that distributors would commit to making certain investments and building their respective natural gas markets. The measures are essential for allowing natural gas to compete with fuel oil, said Oscar Prieto, president of Sao Paulo's Comgas.
About Business News Americas: Business News Americas is a multilingual news and business information service that covers the most important original stories in 11 different business sectors throughout Latin America everyday. Visit BNamericas to access our real-time news reports, 7-year archive, Fact File company database, and latest research reports.
Click here for a Free two week trial to our Latin America Oil & Gas information service.
Most Popular Articles