Amauri Costa Offers Perspective On Latin America’s Energy Future
A new survey of Latin American energy executives paints a vivid picture of the region’s energy future and its challenges. The study was conducted by Bracewell & Giuliani LLP and Business News America. A noteworthy finding is that 62% of the respondents believe oil output in Latin America will peak sometime in the next 10 years.
P&GJ recently examined the study’s country-by-country findings with Bracewell Partner Amauri G. Costa. His observations offer some good words for the wise in the industry.
P&GJ: What findings in your study were most surprising to you?
Costa: I was most surprised by the fact that almost 30% of the survey participants consider nuclear energy necessary in Latin America for the region to achieve sufficient power generation during the next 20 years. Considering the very low use of nuclear energy as a source of power in Latin America, and the region's heavy reliance on hydroelectric and gas-fired thermal power plants, I was surprised by this acknowledgment of the role that nuclear energy may play in the overall energy mix.
This may be fueled by the recent announcements by Brazil to increase the country's nuclear power generation in the future. Such findings demonstrate an increase in the community's awareness that diversity in power generation will be a key factor in overcoming the region's challenges. This reality was painfully experienced by Brazilians in 2001-2002, after droughts significantly reduced the output of that country's hydroelectric plants, which, at the time, represented more than 90% of the country's energy generation.
P&GJ: What is the overall outlook for the immediate and long-term future of Latin America’s oil and gas picture with today’s economic climate?
Costa: Recent developments have positioned Latin America with the rare opportunity to become a major player in the oil and gas industry. The recent oil discoveries in pre-salt fields in southern and southeastern Brazil are historical milestones for the country and, consequently, for the region. These discoveries, if proven, will add billions of barrels to Brazil's reserves. As a consequence, Petrobras forecasts a significant increase in its current daily production over the next few years. Although the current economic climate may result in a reduction in oil and gas consumption in the near term, Brazil's discoveries will take a few years to materialize into production, when the world's economies may have resumed the growth rates seen before the financial crisis.
As a result of such recent discoveries, the energy equation in Brazil and in Latin America is likely to change dramatically in the coming years. Nonetheless, it will take time for the region to develop its full capacity, and success will depend on continuous coordination and focus of governments and their agencies.
P&GJ: What is the demand for new pipelines in Latin America? What major projects are being planned that will require pipeline development?
- Coatings, pipe joint
- Compressor components
- Contractor, pipeline
- Contractor, river crossing/ directional drilling
- Directional drilling rigs, large
- Fittings, valves: plastic
- Meters, flow
- Pigs, cleaning
- Pigs, intelligent
- Pigs, scraper/ sphere launchers/ traps
- Scada systems
- Ultrasonic inspection
- Vacuum excavators/ potholing
- Valves, ball
- Welding systems, automatic