Excelerate takes over operations of Brazil LNG terminal at Bahia: Petrobras

Brazil's Petrobras transferred operations of its LNG terminal in Bahia state to Excelerate Energy, clearing the way for the US-based company to start injecting natural gas into the country's pipeline network, the state-led company said Dec. 6

The transfer was made Dec. 4, shortly after the Justice Ministry's Antitrust Division, known as CADE, approved the leasing agreement on competition grounds.

"Excelerate's regasification vessel is already in position at the Bahia terminal and, with the transfer of operations, Excelerate has the potential to start making natural gas available to the market," Petrobras said.

The final lease agreement also ends a complicated bid process after Petrobras tried for years to lease or sell the three terminals. The Bahia terminal, dubbed TR-BA, initially failed to generate much market interest. Excelerate was the lone company to submit an offer, but it was disqualified because the offer contained conditions not allowed by the tender.

Excelerate will pay $18.8 million to operate the terminal at Baia de Todos os Santos and related infrastructure until December 2023, Petrobras said Sept. 28. The Bahia terminal can import 14 million cubic meters/day, according to Petrobras.

Petrobras is also now free to move its leased regasification vessel, the Golar Winter, to its owned-and-operated LNG terminal at Pecem in Ceara state. Petrobras opened access to the Pecem terminal, called TR-PECEM, in September under an emergency procedure to counter any gas supply shortfalls during the maintenance of a major offshore gas-export pipeline and platform.

The Pecem LNG terminal is located at Pier 2 in the Pecem port. The terminal has installed capacity to inject 7 million cu m/d into Brazil's onshore natural gas pipeline network via a 20-inch-diameter, 19.1-km tranche that connects to the Guamare-Fortaleza pipeline.

Import capacity at Petrobras' Guanabara Bay LNG terminal in Rio de Janeiro state was also increased. In June, regulators approved the boost to 30 million cu m/d from the previous 20 million cu m/d.

Brazil's first three LNG terminals — the Bahia, Pecem, and Guanabara Bay — are all now capable of injecting gas into the country's integrated onshore gas distribution network, Petrobras said. Brazil has a total of five LNG terminals in operation.

The final lease deal should help shore up gas supplies during Brazil's worst drought in 20 years, with lower-than-expected rainfall causing reservoir levels in the country's hydroelectric dam system to fall to record lows. Brazil turned to more-expensive gas- and fuel oil-fired thermal power plants to meet electricity demand to avoid blackouts that battered Latin America's largest economy in 2001.

Petrobras plans to increase LNG import cargoes to 101 in 2021 from 44 in 2020, according to the company.

Excelerate was not immediately available for comment.