Colombia’s gas production potential will fall by 19.8% between 2024 and 2026; new resources urgently needed

Colombia’s gas production potential will fall by 19.8% between 2024 and 2026; new resources urgently needed
Colombia’s gas production potential will fall by 19.8% between 2024 and 2026; new resources urgently needed

According to data recorded by natural gas market agents in their production declaration for 2023, it is observed that production potential will decrease in the following years.

Specifically, according to a report from the Colombian Mercantile Exchange, by 2024, production potential will fall by 7.3 percent; by 2025, 11.6 percent; and by 2026, 9.3 percent (19.8 percent between 2024 and 2026).

Total production potential is the forecast of the quantities of natural gas that can be produced daily on average per month in each field and which were declared by the agents to the Ministry of Mines and Energy.

In 2023, these amounts rose to 1170 GBTUD (Giga BTU per day) without including the capacity of the Cartagena regasification plant. Starting this year, The forecast quantities of all agents begin to gradually decrease each year.

Photo:It’s natural

In addition, The production potential of national fields declared in 2023 did not show increases since the last declaration in 2022, mainly for the short term (2023 to 2026), a period in which a smaller gap between supply and demand is observed.

On the other hand, it stands out a significant drop in the main producing wells such as Cusiana, Cupiagua and Ballena-Chuchupa, which in 2023 supplied 30 percent of the typical supply and 27 percent when the El Niño phenomenon was present, evidencing the urgency of identifying new production potential or other supply sources capable of replacing them in the short term.

The Colombian Mercantile Exchange report also collects and analyzes information on the supply, demand and consumption of natural gas; It provides details on gas market transactions resulting in supply and transport contracts; the operation of the market and the regulated supply and transport marketing mechanisms.

Photo:It’s natural

From 2025 onwards, demand is projected to grow above production potential and exceeds the current declared capacity of 400 GBTUD of the Cartagena regasification plant, in a peak demand projected by the Mining and Energy Planning Unit (Upme) for 2027.

Meanwhile, for 2025 and 2026, according to the outlook, a special analysis would be required and a series of decisions to ensure supply of demand, which would only be overcome with the availability of the imported gas regasification plant.

The report shows that Natural gas demand increased 3.9 percent between 2022 and 2023, a figure slightly lower than that presented between 2021 and 2022 when it was 4.6 percent, a situation explained by the reduction in natural gas consumption by the industry in 2023.

Photo:Canacol Energy

Likewise, it highlights that natural gas generation went from participating in the electricity supply from an average of 8 percent in the period January-August 2023, to 16 percent between September and December 2023.

Finally, according to the records of current quantities of OTMM (Other Wholesale Market Transactions) negotiations in 2023, the consumption sectors that contracted the most natural gas were the thermal sector (80.19 percent) and the industrial sector (11.06 percent), evidencing the highest prices in the thermal sector, mainly in the form of purchase options and interruptions.

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