With credit from the Development Bank of Latin America, an important work of supplying gas to 7 provinces in the north and center of the country is advancing

Although it will not be ready for the start of winter, the reversal of the “Gasoducto del Norte Argentino (GNA)” is vital for adequate gas supply, both for domestic use and for seven provinces in the center and north of Argentina. Electricity production in thermal power plants is growing rapidly, thanks largely to the contributions of the Development Bank of Latin America and the Caribbean, more recognizable as CAF (for Andean Development Corporation) since it was originally born in 1970. Formed through Colombia, Venezuela, Ecuador, Peru and Bolivia.

Argentina joined the organization in 2001, which today has 21 associated countries, two of which are from outside the region: Spain, which joined in 2002, and Portugal, in 2009.

The bank loaned Argentina US$540 million to reverse the GNA, so that the gas, which previously came from Bolivia and flowed from north to south, could flow in the opposite direction, from south to north, and deliver the growing production of “unconventional” gas from the Vaca Muerta from the Neuquén Basin.

Starting in August or September, the gas will replace Bolivia’s dwindling gas supplies, which are now almost unable to meet its own demand. This week’s government Luis Arce The cause and effect of growing shortages, fuel supply shortages and suspicions of black markets and smuggling led to the militarization of the country’s service stations.

The Latin American bank has become a major credit source for Argentina, which today is its main client with an accumulated portfolio of US$5,504 million, 16.1% of its credit portfolio, almost four points above the second (Ecuador, 12.4%) and almost double the third (Brazil, 8.8%).

The reversal of the gas duct is the only national public work presented and initiated by the government Xavier Miley And this is the type of work that is done by the Colombian Sergio Diaz GranadosThe former Minister of Commerce, Industry and Tourism of his country prioritizes the “energy transition” within the framework of his strategy to support it.

Gas is considered a much less polluting hydrocarbon than coal and oil and helps reduce the consumption (and, eventually, also the import) of liquid fuels such as diesel and fuel oil. Of the 16 projects listed and identified in South America in the latest CAF annual balance sheet, the GNA reversal is marked as number one.

The work, which will provide gas to the provinces of Santiago del Estero, Tucumán, Catamarca, Salta, Jujuy, La Rioja and Córdoba, is progressing under the supervision of state-owned Enarsa and is being carried out by the Transitory Union of Companies (UTE) formed by Techint and Sacade, which also built at record speed the first section between the cities of Trayen (Neuquen) and Salicelo (Buenos Aires) of the “Presidente Néstor Kirchner Gasduct”, inaugurated on July 9 last year, although its compressor stations were not completed and this means that now the Vaca Muerta gas pipeline flows a maximum of 11 million cubic meters of gas per day, a volume below its capacity and insufficient to fully cover the gas consumption of the Metropolitan Area of ​​Buenos Aires (AMBA) in the coldest months of the year.

The reversal of the GNA will allow about 16 million cubic meters of gas per day to reach the northern and central provinces, improving coverage of the country’s total gas demand. For the first cold weeks and months of this winter, the gas consumption of these provinces will be supplied, at least in part, with liquefied natural gas (LNG), which arrives in ships at the Mejillones regasification plant in Chile, and will reach Argentina via the Norandino gas pipeline.

The “reversal” – Enarsa said in a recent statement – already includes the regular line welding of sections 2 and 3, the first 100 kilometers of the so-called “Federal Integration Gas Pipeline” – out of a total of 122 km – which extends from Tio Pujio in Córdoba to La Carlota, connecting the Central-West and Northern gas pipelines.

The entity reported that to reduce the working time, an automatic welding system was used (the same one implemented in GPNK) and 4,059 welds had already been carried out in 41 days, with a record of up to 151 welds (about 3 kilometers) per day. Further, the company said, “work is in progress on the remaining 22 kilometers of the gas pipeline, with the construction of 62 kilometers.” Loops Change of direction of the Northern Gasduct and 4 Compressor Plants at the heights of the cities of Ferreyra and Córdoba, with the completion date of the works scheduled for the end of August.

Techint and Sakde completed those weldings, but they have not yet collected them from the National State, to which they owed around $ 14,000 million in May, covered by loans from commercial banks.

The total budget for the work is US$720 million, of which a US$540 million loan from a Latin American bank covers three quarters. The remaining quarter will be covered by a fund for electricity exports from Argentina, although the increase in construction costs in dollars (a recurring problem of the current economic plan, in which the dollar’s monthly growth pattern lags far behind inflation) makes it possible that the final cost in dollars will exceed the initial budget.

The collapse of Bolivian gas sales and the need to overturn the GNA is a long-told story. For example, in July 2003, then-energy secretary, Flavia Royanexplained in a proposal that there was a “high risk of natural gas and electricity shortages for users in the center and north” due to the end of Bolivia’s contribution in 2024. But despite having a US$540 million loan from the Development Bank of Latin America, the Fernández government threatened several times to put the work out for tender but never started it.