IDEAS home Printed from https://ideas.repec.org/a/eco/journ2/2024-01-61.html
   My bibliography  Save this article

Brazil’s New Gas Law: Analysis, Implications, and Remuneration of Gas Processing Plants with Non-Discriminatory Access to Customers

Author

Listed:
  • Samuel Mathias do Amaral Junior

    (Federal University of Latin American Integration, Silvio Américo Sasdelli Avenue, 85866-000, Foz do Iguaçu, PR, Brazil)

  • Janine Carvalho Padilha

    (Federal University of Latin American Integration, Silvio Américo Sasdelli Avenue, 85866-000, Foz do Iguaçu, PR, Brazil)

  • Leonardo Arrieche

    (Federal University of Latin American Integration, Silvio Américo Sasdelli Avenue, 85866-000, Foz do Iguaçu, PR, Brazil)

Abstract

Brazil will increasingly rely on the availability of natural gas as new discoveries in the Pre-Salt portion are explored. Currently, a substantial amount of the gas produced associated with oil is reinjected (60,84 million m³/day in 2021, according to the Ministry of Mines and Energy), with the lack of structure being one of the factors for this non-energy purpose. The New Gas Law proposes to fill this gap by stimulating investments in infrastructure. In this sense, market opening has the potential to promote the rupture of natural monopolies by providing access to infrastructure, including Natural Gas Processing Plants (NGPP). This units, in addition to conditioning the gas for sale, allow the recovery of higher molecular weight fractions, or (Natural Gas Liquid). However, the instructions for this access required by the government are insufficient for issues related to the NGL recovery efficiency of these units, as well the method of remuneration arising from the NGL production capacity. It is proposed in this paper to include a processing tariff, based on static simulation of available technological routes. Comparison of energy spent and NGL recovery efficiency will allow to formulate the gas price, unfolding from the price of the molecule.

Suggested Citation

  • Samuel Mathias do Amaral Junior & Janine Carvalho Padilha & Leonardo Arrieche, 2024. "Brazil’s New Gas Law: Analysis, Implications, and Remuneration of Gas Processing Plants with Non-Discriminatory Access to Customers," International Journal of Energy Economics and Policy, Econjournals, vol. 14(1), pages 559-569, January.
    • Handle: RePEc:eco:journ2:2024-01-61
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijeep/article/download/15127/7706
    Download Restriction: no
    File URL: https://www.econjournals.com/index.php/ijeep/article/view/15127
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Yoon, Sekwang & Binns, Michael & Park, Sangmin & Kim, Jin-Kuk, 2017. "Development of energy-efficient processes for natural gas liquids recovery," Energy, Elsevier, vol. 128(C), pages 768-775.
    2. García Kerdan, Iván & Jalil-Vega, Francisca & Toole, James & Gulati, Sachin & Giarola, Sara & Hawkes, Adam, 2019. "Modelling cost-effective pathways for natural gas infrastructure: A southern Brazil case study," Applied Energy, Elsevier, vol. 255(C).
    3. Kan, S.Y. & Chen, B. & Wu, X.F. & Chen, Z.M. & Chen, G.Q., 2019. "Natural gas overview for world economy: From primary supply to final demand via global supply chains," Energy Policy, Elsevier, vol. 124(C), pages 215-225.
    4. Leal, Fernando I. & Rego, Erik E. & de Oliveira Ribeiro, Celma, 2019. "Natural gas regulation and policy in Brazil: Prospects for the market expansion and energy integration in Mercosul," Energy Policy, Elsevier, vol. 128(C), pages 817-829.
    5. Thomas, Melanee & DeCillia, Brooks & Santos, John B. & Thorlakson, Lori, 2022. "Great expectations: Public opinion about energy transition," Energy Policy, Elsevier, vol. 162(C).
    6. Santillán Vera, Mónica & García Manrique, Lilia & Rodríguez Peña, Isabel & De La Vega Navarro, Angel, 2023. "Drivers of electricity GHG emissions and the role of natural gas in mexican energy transition," Energy Policy, Elsevier, vol. 173(C).
    7. Campos, Adriana Fiorotti & da Silva, Neilton Fidelis & Pereira, Marcio Giannini & Vasconcelos Freitas, Marcos Aurélio, 2017. "A review of Brazilian natural gas industry: Challenges and strategies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 75(C), pages 1207-1216.
    8. da Silva, Vinícius Oliveira & Relva, Stefania Gomes & Mondragon, Marcella & Mendes, André Bergsten & Nishimoto, Kazuo & Peyerl, Drielli, 2023. "Building Options for the Brazilian Pre-salt: A technical-economic and infrastructure analysis of offshore integration between energy generation and natural gas exploration," Resources Policy, Elsevier, vol. 81(C).
    9. Goldemberg, José & Schaeffer, Roberto & Szklo, Alexandre & Lucchesi, Rodrigo, 2014. "Oil and natural gas prospects in South America: Can the petroleum industry pave the way for renewables in Brazil?," Energy Policy, Elsevier, vol. 64(C), pages 58-70.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Herrera, Milton M. & Dyner, Isaac & Cosenz, Federico, 2019. "Assessing the effect of transmission constraints on wind power expansion in northeast Brazil," Utilities Policy, Elsevier, vol. 59(C), pages 1-1.
    2. Gurbanov, Sarvar, 2021. "Role of Natural Gas Consumption in the Reduction of CO₂ Emissions: Case of Azerbaijan," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 14(22).
    3. Wadim Strielkowski & Anna Sherstobitova & Patrik Rovny & Tatiana Evteeva, 2021. "Increasing Energy Efficiency and Modernization of Energy Systems in Russia: A Review," Energies, MDPI, vol. 14(11), pages 1-19, May.
    4. Cai, Xiaomei & Liu, Chan & Zheng, Shuxian & Hu, Han & Tan, Zhanglu, 2023. "Analysis on the evolution characteristics of barite international trade pattern based on complex networks," Resources Policy, Elsevier, vol. 83(C).
    5. Sofia Dahlgren & Jonas Ammenberg, 2021. "Sustainability Assessment of Public Transport, Part II—Applying a Multi-Criteria Assessment Method to Compare Different Bus Technologies," Sustainability, MDPI, vol. 13(3), pages 1-30, January.
    6. Shuguang Liu & Jiayi Wang & Yin Long, 2023. "Research into the Spatiotemporal Characteristics and Influencing Factors of Technological Innovation in China’s Natural Gas Industry from the Perspective of Energy Transition," Sustainability, MDPI, vol. 15(9), pages 1-34, April.
    7. Dara, Satyadileep & Abdulqader, Haytham & Al Wahedi, Yasser & Berrouk, Abdallah S., 2020. "Countrywide optimization of natural gas supply chain: From wells to consumers," Energy, Elsevier, vol. 196(C).
    8. Lee, Joonseop & Lee, Dongyoung & Seo, Yongwon, 2021. "Experimental investigation of the exact role of large-molecule guest substances (LMGSs) in determining phase equilibria and structures of natural gas hydrates," Energy, Elsevier, vol. 215(PB).
    9. Brito, Thiago Luis Felipe & Islam, Towhidul & Stettler, Marc & Mouette, Dominique & Meade, Nigel & Moutinho dos Santos, Edmilson, 2019. "Transitions between technological generations of alternative fuel vehicles in Brazil," Energy Policy, Elsevier, vol. 134(C).
    10. Fátima Lima & Joana Portugal‐Pereira & André F.P. Lucena & Pedro Rochedo & Jorge Cunha & Manuel Lopes Nunes & Alexandre Salem Szklo, 2015. "Analysis of energy security and sustainability in future low carbon scenarios for Brazil," Natural Resources Forum, Blackwell Publishing, vol. 39(3-4), pages 175-190, August.
    11. Peng, Huaxi & Kan, Siyi & Meng, Jing & Li, Shuping & Cui, Can & Tan, Chang & Wang, Zhenyu & Wen, Quan & Guan, Dabo, 2024. "Emission accounting and drivers in South American countries," Applied Energy, Elsevier, vol. 358(C).
    12. Yang, Ju-Ying & Dodge, Jennifer, 2024. "Local energy transitions as process: How contract management problems stymie a city's sustainable transition to renewable energy," Energy Policy, Elsevier, vol. 184(C).
    13. Myriam Caratù & Valerio Brescia & Ilaria Pigliautile & Paolo Biancone, 2023. "Assessing Energy Communities’ Awareness on Social Media with a Content and Sentiment Analysis," Sustainability, MDPI, vol. 15(8), pages 1-28, April.
    14. Miguel A. Morales Mora & Andrea Marín Rovira & Vicente A. Soriano Ramirez & Patricia López Rivera & Omar Guillen Solis & Vincent Pozos Castillo & Gonzalo AngelesOrdoñez & Alejandro Castillo Antonio & , 2024. "An integrated analysis of the Mexican electrical system’s metabolic pattern and industry sector in the energy transition," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(9), pages 24313-24338, September.
    15. Casper Boongaling Agaton, 2022. "Will a Geopolitical Conflict Accelerate Energy Transition in Oil-Importing Countries? A Case Study of the Philippines from a Real Options Perspective," Resources, MDPI, vol. 11(6), pages 1-17, June.
    16. Rivera-Alvarez, Alejandro & Osorio, Julian D. & Montoya-Duque, Laura & Fontalvo, Jose & Botero, Edgar & Escudero-Atehortua, Ana, 2020. "Comparative analysis of natural gas cogeneration incentives on electricity production in Latin America," Energy Policy, Elsevier, vol. 142(C).
    17. Wang, Xin & Yang, Jianxun & Zhou, Qi & Liu, Miaomiao & Bi, Jun, 2022. "Mapping the exchange between embodied economic benefits and CO2 emissions among Belt and Road Initiative countries," Applied Energy, Elsevier, vol. 307(C).
    18. Huang, Chenchen & Lin, Boqiang, 2023. "Promoting decarbonization in the power sector: How important is digital transformation?," Energy Policy, Elsevier, vol. 182(C).
    19. Usubiaga-Liaño, Arkaitz & Arto, Iñaki & Acosta-Fernández, José, 2021. "Double accounting in energy footprint and related assessments: How common is it and what are the consequences?," Energy, Elsevier, vol. 222(C).
    20. Menzel, Tobias & Teubner, Timm, 2024. "Signaling sustainability and regionality in the electricity market: An eye-tracking study on visual labels," Applied Energy, Elsevier, vol. 353(PB).

    More about this item

    Keywords

    Natural Gas; Natural Gas Processing Plants; Brazil’s New Gas Law; Processing Tariff; Natural Gas Regulation;
    All these keywords.

    JEL classification:

    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ2:2024-01-61. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.