Lifting restrictions on LPG usage could boost demand by 5pc over the next five years, LPG association Sindigas' chief executive Sergio Bandeira de Mello told Argus.
LPG has been prohibited in Brazil for usage in automotive and other engines except for forklifts and industrial cleaning equipment. It is also illegal for saunas, boilers and pool heating, except for medicinal purposes.
But the mines and energy ministry's oil and gas secretary has called for the use of LPG to help power the Energy for the Amazon project, launched last year to reduce diesel usage and decrease greenhouse gas emissions in the region.
"LPG should be a much cleaner option than diesel in the [Amazon] region," Mello said.
ANP will review the existing legislation by 2025, he added.
Brazil uses 25pc of its 7.5mn metric tonnes/yr of LPG demand for industrial and commercial purposes, according to Sindigas. State-controlled Petrobras produced 4.2mn t of LPG in 2023, a 6pc increase from a year earlier and surpassing the previous high set in 2007.
In addition, the market for BioLPG — a drop-in substitute for LPG produced from vegetable oil, agricultural waste or biogas from landfills — is also growing, as LPG distributors Ultragaz and Copa Energy are eyeing developments in the field, with the former close to a first retail sale.
Hydrocarbons regulator ANP's plan to revamp LPG's legal framework at the beginning of the decade was postponed to 2025 because of geopolitical crises such as the Russia-Ukraine conflict that roiled energy markets globally, along with a series of internal difficulties, including lack of personnel, to deal with several issues on the regulator's plate.
But Brazil remains optimistic about expanding LPG usage to new areas and believes in its competitive viability, Mello said, arguing that LPG could have more space in the energy mix. The last World LPG Association meeting in Rome in December debated how a net zero future — which will heavily depend on renewable energy sources — may neglect a large portion of the world's population, especially those in less-developed countries trapped in energy poverty.
According to Sindigas, 91pc of Brazilian households rely on LPG, mostly for cooking.
Should Brazil remove LPG usage restrictions, the sector expects demand to increase but pose no threat to supplies — a main concern back in the 1990s when the regulations first appeared. LPG's main competitor in Brazilian homes is firewood, which has less calorific capacity, Mello said.
