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New legal framework for the natural gas industry was approved and new investments are on the way
The federation of industries of Rio de Janeiro (Firjan) estimates that Brazil should receive more than R$ 88 billion in investments after the conclusion of the approval of the new legal framework for the natural gas sector, in Câmara dos Deputados, at dawn this Wednesday, after years of waiting. The new legal framework was approved without the hundreds of amendments proposed by the Federal Senate and now depends only on presidential sanction. Among other measures, the law allows natural gas pipelines to be built upon authorization, and no longer concession, which speeds up the process.
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Firjan highlights the importance of approval
“Now, the legal framework goes to the presidential sanction, which should happen quickly, allowing to expand the execution of projects of great relevance for the country. With the regulatory improvements in the new legislation, the volume of investments should increase in activities from the natural gas market to final consumption in industrial plants,” said Firjan.
According to a study by the company, the potential for expanding demand in the State of Rio de Janeiro, which should materialize with the new business environment, could lead to an increase in demand of up to 13 million cubic meters per day (m3/day), with the resumption of industrial activity, implementation of CNG projects for heavy vehicles and prospects for new industrial plants.
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Approval of the new natural gas legal framework
The project for the new legal framework was approved by the Chamber of Deputies in the form of a substitute for the Mines and Energy Commission, authored by deputy Silas Câmara, with a favorable opinion by Laercio Oliveira.
For Laercio Oliveira, the proposal has the capacity to transform the market that was monopolized for many years. He said celebrating: “Today we deliver to the country a modern investment project, which will promote competition.”
However, the opposition obstructed the work during the vote, disagreeing with the results promised by the government's investments with the new legal framework.
“The purpose of this project is to facilitate the privatization and import of natural gas, when Brazil is one of the world's largest producers of gas coming from the pre-salt layer and reinjected into oil wells,” said congressman Carlos Zarattini.
Experts explain why investments in the natural gas market are good for Brazil
Natural gas is of paramount importance for the economy and also for the environment. Starting with its quality and ability to replace any fuel derived from petroleum, such as coal, diesel, oil and alcohol, it is also used in fertilizers, and in the production of urea and ammonia.
In the environment, the use of gas prevents deforestation in the Brazilian territory and reduces the impacts caused to nature and, if produced sustainably, also reduces pollutant emissions. Natural gas has the potential to supply the growing global demand for fuel.
With the advancement of technology, companies have made investments in centrifuge equipment to clean the fuel which is known as Turbo Trays. This product has the capacity to increase gas production by 80%
