In Argentina, gas is an emerging threat for refiners: Fuel for Thought

When Gas Natural Fenosa and Metrogas, two leading natural gas distributors in Argentina, launched a campaign in May to get motorists to convert their cars to run on gas, it didn’t surprise the energy industry. The “Switch to Gas” campaign highlights the ease of converting cars to compressed gas, or CNG, and filling up at a stations nationwide, plus the lower carbon emissions. The clincher is that CNG is 50% cheaper than gasoline, according to the distributors. CNG has been used as by cars and taxis in Argentina for years, and the fleet is at 1.7 million, or 16% of the 10.7 million cars on the streets, according to industry data. But distributors have shied away from promoting CNG since 2007, when shortages hit as production slid from a peak of 143 million cu m/d to what would become a 16-year low of 113.7 million cu m/d in 2014. This left the country with a 25% deficit. Now Argentina’s gas fortunes are improving, led by the development of giant Vaca Muerta shale play, and this has shifted the industry’s concerns from shortages to a looming glut in the warmer months when residential demand for heating subsides. HUNTING FOR BUYERS Gas producers… continue reading

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