Brazil natural gas reinjection hits record in April

Natural gas reinjection in Brazil hit a record volume in April of 61mn m³/d, preliminary data from Brazil's oil and gas regulator ANP shows, the highest since October 2017.

Some natural gas that is produced from oil and gas wells is pumped back into oil and gas wells to repressure the reservoir and increase future oil production.

Total Brazilian natural gas production was 131.4mn m³/d (4.64 Bcf/d) in April, ramping up 5.99pc over April 2020 and by 4.24pc over March 2021. The record for Brazilian gas production was 138.7mn m³/d in January 2020.

Natural gas flaring rose by 6pc in April over April 2020, but was down by 9pc compared to March.

After reinjection and flaring, Brazilian gas producers offered to the market 53.5mn m³/d in April, an increase of 5.72pc over April 2020 and 6.61pc over March 2021.

This gas volume is still below levels seen after flaring and reinjection before Covid-19 restrictions took hold in March 2020, when 61.3mn m³/d was offered to the market.

As nearly 90pc of Brazilian gas production is associated with oil output, producers may choose to reinject the gas to elevate oil production or because of restrictions in gas processing, transporting or trading. The incentive to reinject is expected to drop when pre-salt flow gas pipeline Rota 3 starts operation, which is expected this year. The pipeline will be able to take 20mn m³/d to Brazilian gas flow.

"There is always a component of the oil business," said Adrianno Lorenzon, natural gas manager at Brazilian Large Energy Consumers Association (Abrace). "But Petrobras is expected to inaugurate Rota 3 within the next few months and this reinjection volume is expected to drop."

Reinjection also rises when more natural gas is produced because CO2 is reinjected.

The growth in injected volumes is mainly a result of the increase in the production of associated gas in the Santos basin also increasing volumes of CO2, which need to be reinjected, and limited pipeline flow, said Ieda Gomes, senior visiting fellow at the Oxford Institute for Energy Studies.

By Flávia Pierry