Colombian distributor eyes abandoned PdV gas line

Colombian gas distributor Promigas and its local partner Gases de la Guajira are proposing to use Venezuelan state-owned PdV's idle cross-border pipeline as a domestic alternative for sending Chevron gas to Colombian border city Maicao.

"Promigas identified this (pipeline) as an alternative for supplying the Maicao market. We understand that Gases de la Guajira already started a process with (PdV)," Barranquilla-based Promigas told Argus on 31 March.

Riohacha-based distributor Gases de la Guajira said it sent an official request to PdV exploring the possibility of using its 450mn cf/d Trans-Caribbean "Antonio Ricaurte" gas pipeline. "We have not heard anything (from PdV)," the company said.

PdV subsidiary PdV Gas did not immediately comment, but the firm is understood to be considering what fee it would charge for leasing the Colombian portion of the line.

The idle line built in 2007 runs 224km (139mi) from Riohacha in Colombia´s Guajira province to Bajo Grande in the western Venezuelan province of Zulia.

Gases de la Guajira said it or Promigas would have to build an additional 4km connector from PdV's gas line to Maicao city infrastructure, a process that would require local indigenous community Wayuu's approval.

Promigas operates the Riohacha-Maicao pipeline through which Gases de la Guajira currently transports around 510,000 cf/d to the Colombian city of 110,000 residents, located near the border with Venezuela.

Promigas says it has been struggling to conduct maintenance on the Riohacha-Maicao line over the past two years because of resistance from the Wayuu.

If Gases de la Guajira cannot make a deal with PdV, the last resort would be construction of a new gas line, "which would be very expensive," Gases de la Guajira says.

PdV's pipeline also needs technical work and maintenance.

Colombia´s Caribbean coast market is seeking new gas supplies as Chevron's mature Guajira gas fields continue to decline.

The Guajira fields that include offshore Chuchupa and onshore Ballena average around 320mn cf/d, according to Colombian oil and gas regulator ANH.

Chevron's Ballena, Chuchupa and Riohacha fields reached peak production of 684mn cf/d in 2010. The company shut in Riohacha in 2015.

As late as September 2016, PdV had pledged to start sending gas to Colombia through the cross-border line from Venezuela´s offshore Perla operated by Spain´s Repsol and Italy´s Eni.

Shipments were scheduled to start in December 2016 at 50mn cf/d and increase to 85mn cf/d by 2017 and 150mn cf/d three years later. The plan never materialized, apparently because of PdV´s financial troubles.

Colombia had been shipping small volumes of gas to Venezuela on the cross-border line up until mid-2015.

Colombia produced 901mn cf/d of gas output in February, compared to last year's average of 976mn cf/d.

The decline in gas production, and Venezuela´s failure to honor its gas export pledge, led a group of thermal power generators in Colombia to launch a regasification plant near Cartagena last year.