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Argentine natural gas: A risk for hydrogen in Brazil amid shortages and the future of the natural gas market?

Written by Caio Aviz
Published 04/12/2024 às 17:15
Argentine gas and its impact on hydrogen production in Brazil, with emphasis on industrial infrastructure at sunset and flags of Argentina and Brazil.
Natural gas industrial infrastructure at sunset, highlighting the relationship between Argentine gas and the hydrogen market in Brazil.

Understand how natural gas from Argentina can impact the Brazilian energy market and compete with renewable hydrogen in the future of the energy transition.

Is Argentine gas a risk for hydrogen in Brazil?

Natural gas plays an essential role in Brazil's industrialization process. However, using it as a definitive solution for the energy market does not seem to be the best strategy. After all, Brazil has abundant resources that can ensure its self-sufficiency in hydrogen renewable. In this context, it is crucial to reflect on the impacts and the energy choices the country is making today to meet future demands.

The role of the Brazil-Bolivia Gas Pipeline in the energy transition

Em December 2023, Bolivian state-owned company YPFB has reached an agreement to transport natural gas extracted from Dead cow, in Argentina, to Brazil, using the Bolivia-Brazil Gas Pipeline (Gasbol). This contract aims to supply the shortage of natural gas in the country and increase competitiveness in the energy market. On the other hand, this movement also raises questions. Is investing in natural gas Doesn't it delay the advancement of low-carbon hydrogen, which is cleaner and more sustainable? The question becomes even more relevant when we consider that hydrogen does not emit carbon dioxide during its use, unlike natural gas.

Industrialization and the challenges of energy costs

The decision to import Argentine gas rekindles hopes of lower costs for domestic industries. However, ensuring more affordable prices depends on a number of factors, such as the integration of other sources of natural gas, including Bolivian and imported from the United States. Still, the green hydrogen emerges as a solution that can combine competitiveness and sustainability process in the near future. Furthermore, while the projects of hydrogen advance slowly, gas remains a short-term alternative. However, public policies need to balance gas use with the development of cleaner technologies.

Multi-molecule pipelines: a solution for the future?

The expansion of infrastructure for gas transportation, such as gasbol, must be done strategically. Many experts have already warned of the risk of creating stranded assets if hydrogen becomes more economically viable in the coming years. To avoid waste, it is necessary to plan the construction of multi-molecule pipelines, which can transport natural gas, hydrogen and carbon. Recent studies show that mixing up to 20% hydrogen to natural gas is already technically possible, which demonstrates that hybrid solutions can be adopted to meet market demands.

Brazil must look beyond natural gas

Although the natural gas is important to meet immediate demands, it is essential that Brazil thinks about long term. Invest in renewable hydrogen, with its environmental and economic benefits, can consolidate the country as global leader in the energy transition. Therefore, while the Argentine gas can alleviate short-term issues, offuture of the Brazilian energy market requires decisions that prioritize sustainability and innovation.

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Caio Aviz

I write about the offshore market, oil and gas, job vacancies, renewable energy, mining, economy, innovation, geopolitics and government. Always seeking daily updates and relevant topics, I expose rich, considerable and meaningful content.

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