FORECASTING NATURAL GAS MARKETS BETWEEN CHILE AND ARGENTINA UNDER DEVELOPMENTS OF UNCONVENTIONAL GAS AND EXPANSION OF LNG REGASIFICATION PLANTS

摘要

The privatization process of the natural gas industry in Argentina by the beginning of the 90s carried out important investments in transport infrastructure1, allowing to connect Chilean consumers at the north, center and south of the country with the productive Argentinean basins. The legal framework that allowed it was the "Acuerdo de Complementacion Economica" (ACE) between Argentina and Chile, complemented through several protocols that regulated how firms participated in the market. Seven pipelines were built over this period. As a result of the regulatory framework, over 3.500 km of pipelines were built, with an investment over 2 billion dollars. By 1997, Argentina could export supply excess to Chile, Brazil and Uruguay. By 2004, 92,5% went to Chile, 6% to Brazil and 1,5% to Uruguay. Regardless the reserves/production ratio was 25 years at the moment of the privatization in Argentina, by 2004 it went down to 10 years due to a smaller rate of discovery of new reserves than the rate of production. Due to the economic crisis in Argentina, natural gas tariffs were frozen in October 2001. In a scenario of economic growth after the crisis with frozen tariffs, there was an important increment in demand of natural gas, for residential and industrial use, but also in power generation. At the same time, losing the price signal discourage investment in exploration. Demand was exerting pressure on a weak supply on the Argentinean side. In consequence, the Argentinean government decided to suspend the exportation of excess supply of natural gas in order to keep the internal demand satisfied. The gas crisis was starting, having its peak in 2007 when Argentinean exports were zero. The main input in thermal power generation in Chile until 2003 was the Argentinean Natural Gas. Combine cycles had become the main technology of expansion in the power sector, reaching 36% of the total generation..