The development bank of Latin America and the Caribbean (CAF) and The Latin American and Caribbean Energy Organization (OLACDE) are pleased to announce the signing of a Technical Cooperation Agreement to promote energy integration in MERCOSUR countries, Bolivia, and Chile. This agreement, which consolidates the collaboration between both institutions, aims to contribute to a fair energy transition by leveraging gas resources through the optimization and expansion of natural gas transportation infrastructure.
Current and future challenges in the region
In recent decades, the energy landscape has evolved with the incorporation of new sources of supply and liquefied natural gas (LNG) regasification technology in Chile, Argentina, and Brazil. The development of unconventional deposits, such as the Vaca Muerta formation in Argentina, and the advancement of hydrocarbon resources in Brazil’s deep waters, have opened new opportunities and challenges in the energy sector. Additionally, since the 2000s, the global development of the LNG market has driven the installation of regasification plants in Chile, Argentina, and Brazil to ensure a constant energy supply.
“Regional energy integration is a fundamental pillar for the sustainable development of Latin America. This partnership with OLACDE allows us to join efforts to create a stronger and more efficient energy network that benefits all the countries involved,” said Antonio Silveira, CAF’s Manager of Physical Infrastructure and Digital Transformation.
For his part, the Executive Secretary of The Latin American and Caribbean Energy Organization (OLACDE) stated, “At OLACDE, we are proud to formalize this cooperation agreement with CAF. This strategic alliance marks a milestone in our commitment to promoting energy integration in MERCOSUR countries, Bolivia, and Chile. This agreement not only strengthens our inter-institutional collaboration but also underscores our shared vision of moving towards a fair and sustainable energy transition.”
The regional gas integration project driven by CAF and OLACDE will seek to create a regional gas balance that optimizes the use of existing and projected infrastructure. Additionally, work will be done on regulatory convergence scenarios that allow for strategic planning tailored to each country’s energy and economic needs, overcoming historical barriers and advancing toward more equitable and inclusive integration, enabling all countries in the region to benefit from an efficient and secure energy network.
The work will be divided into 5 phases, each culminating in an in-person validation and consensus session with relevant stakeholders: (i) review and consolidation of available studies, (ii) projection of supply and demand, (iii) optimization of existing infrastructure, (iv) optimization with new infrastructures, and (v) preparation of project profiles.
“This agreement marks a milestone in our commitment to a fair and inclusive energy transition. Natural gas will play a crucial role as a transition energy, allowing us to reduce emissions while ensuring reliable and affordable energy access for all,” said Jorge Srur, CAF’s Regional Manager for the South.
The signing of the agreement took place in Asunción, Paraguay, as part of the IX Energy Week, an event that brings together the main regional energy actors to discuss challenges and opportunities in the sector’s transformation.
