COVID-19: Natural gas agenda goes on alert

The pandemic of the new coronavirus has created an excessive supply of electricity, which brings a warning signal to the natural gas agenda in the Country. Long-term contracts of the thermal power industry are considered to be strategies to create the necessary demand and provide security to private investors in the natural gas sector.

However, the new supply of natural gas depends on a new infrastructure, according to Cláudia Brun, Vice-President of the Energy Marketing from Equinor Brazil. This type of investment would only become viable if there were demand anchors for the sector.

"Without long-term contracts to back these investments it is very difficult to convince our board that the approval of these mainstream and upstream projects happen," said Brun, during the virtual seminar promoted by BNDES last week, and continued: "The postponement of auctions and the scenarios of electricity demand after the coronavirus are not promising for the viability of the demand for long-term. And without a long-term demand, it is difficult to make investments," he concluded.

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