Sycar LLC becomes the first company with ministerial authorization to import and market natural gas in Ecuador

On February 11, the Ministry of Energy gave the authorization to the American company. Industry asks for competitive prices.

US natural gas importerSycar LLC is the first foreign company with permission to market natural gas for Ecuador. On February 11, the Ministry of Non-Renewable Natural Resources granted it approval to market natural gas, liquefied natural gas (LNG) and compressed natural gas (CNG) for the country's industrial market.The approval resolution is MERNNR-VH-2021-0008-RM.

In this way, the Government effectively opens the door to fuel imports. The Ministry of Energy is also looking at the possible 25-year concession of the Machala thermo plant with the company New Fortress, whose external adviser is the former Minister of Energy Carlos Pérez. This project also has the importation of natural gas as a key part of the business.

Nelson Jaramillo, managing partner of the Sycar project, indicated in his statement that the resolution “is good news for our project and a step towards the construction of the first LNG import terminal in Ecuador, which is still on the schedule to begin. this year".

The project includes the construction of port facilities for the docking of a floating storage and regasification unit (FSRU) or barge to supply natural gas to the electrical and industrial markets of Ecuador. According to the technical proposal, presented in April 2019 to the country,Sycar LLC is working with Gunvor, an LNG trading company,for the development of an import terminal for this fuel for Ecuador.Gunvor is remembered for having been part of Ecuador's oil brokerage scheme with China, according to revelations obtained from the Panama Papers, to which this newspaper had access.

For its part, Sycar assured in a press release that “Ecuador's industrial sector has given a positive response to this future availability of LNG as an opportunity to reduce manufacturing and maintenance costs, reduce its carbon footprint, and improve the efficiency and useful life of major equipment, the statement said..

Andrés Robalino, executive director of the Chamber of Industries, Production and Employment of Azuay, indicated that the concern of the union, which is representative of 11 of the 13 companies that use natural gas, is that the demand for natural gas has not been satisfied by the Government due to the serious problems that occurred at the Bajo Alto plant.

Robalino said he was in agreement with the greater endowment of natural gas. However, he said that it would always be better if it could be produced in the country, but if this were not possible, the important thing would be for the prices at which natural gas is finally sold to be as competitive as possible.

Natural gas, which is different from liquefied petroleum gas (domestic), is the natural substitute for diesel, cleaner and cheaper. However, controversy has been generated on the subject, as analysts see the promotion of the gas market as positive, but they also ask that the national production of this fuel be supported and not only imports be seen as an option.

JJorge Luis Hidalgo, from the Ecuadorian company Green Power,whose objective is to build and operate a liquefaction plant in the country to process local natural gas, indicated that it is positive that the path is being opened for the development of this industry in the country.

However, wait"That with the same speed the authorizations are also delivered to our company Greenpower with investment 100% at private risk that has complied with the current law and regulations and has corresponding favorable reports in a process that takes three years."We trust in the country and we are committed to the national production of natural gas. This is why we hope that we will be offered the same conditions as importers.

For Hidalgo, the competition between nationals and importers will give the final customer a greater benefit of price, quality and service.

Hidalgo, who maintains that there aregood natural gas reserves in Campo Amistad, recalled that a few days ago there was an increase in production of 24%, and this despite the fact that modest investments have been made to refurbish wells.

With this increase, "it is estimated that the field will increase its useful life by three years of commercial production, although we know that it has greater potential if investments are made for maintenance, drilling of proven and undeveloped reserves that still exist, and development of new fields." . Hidalgo maintains that natural gas from the Amazon and Santa Elena can also be used.