ANCAP Interested In Hydrogen For Transport, Marta Jara Says

(Energy Analytics Institute, Aaron Simonsky, 11.Nov.2018) — Uruguay is studying possibilities with hydrogen.

“ANCAP is interested in the hydrogen option, because it is an ideal energy for transport, and which can be managed with an infrastructure similar to that of other liquid fuels,” reported online media LaRed21, citing ANCAP President Marta Jara.

Hydrogen as a fuel is currently being analyzed by certain countries worldwide due to its “zero emissions,” which reap benefits for the planet.

Hydrogen can be physically stored as either a gas or a liquid. Storage as a gas typically requires high-pressure tanks (5000–10,000 psi tank pressure). Storage of hydrogen as a liquid requires cryogenic temperatures since the boiling point of hydrogen at one atmosphere pressure is -252.8°C, according to data posted to the website of the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy or EERE.

“Not all the renewable energy generated in [Uruguay] is used; therefore, the hydrogen option would allow for storage,” concluded Jara.

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#LatAmNRG

Uruguay Sets Deadline To Seek Renewable Energy Fiscal Incentives

(Energy Analytics Institute, Ian Silverman, 13.Oct.2018) — Companies seeking to benefit from renewable energy tax benefits will have until October 24, 2018 to submit details related to their projects.

Companies that register before the date could potentially obtain equivalent discounts of up to 70% of their investments, reported the daily newspaper LaRed21.

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Energy Analytics Institute (EAI): #LatAmNRG

Uruguay Judge Orders ANCAP to Pay $5.6 Mln to Exor Internacional Ltda.

(Energy Analytics Institute, Ian Silverman, 28.Sep.2018) — Uruguayan Judge Carlos Aguirre ordered ANCAP to pay a fine of $5.6 million plus interest to Exor Internacional Ltda. as a result of a “patrimonial trial related to administrative responsibility,” reported the daily LaRed21.

The Exor payment relates to a debt maintained with Venezuela’s state oil company PDVSA, according to the daily.

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PDVSA Leaves Argentine Gas Station to Fend for Itself

(Reuters, Luc Cohen, 15.Aug.2018) – As Venezuela’s state-owned oil company PDVSA saw its finances devastated by low oil prices and mismanagement, it funneled millions of dollars to Petrolera del Conosur (PSUR.BA), a loss-making Argentine gas station operator it controls.

PDVSA decided to cut off the support payments late last year, according to a person familiar with Petrolera del Conosur’s operations, as the once-proud icon of Venezuelan oil production struggled with declining output aggravated by a worsening economic crisis.

The transfers had totaled $89 million between 2013 and 2017, according to a Reuters review of filings with Argentina’s securities regulator, years that coincided with a frustrated effort by Venezuela to extend the petro-diplomacy it employed in the Caribbean to the southern cone of Latin America.

Profitability was likely never the true goal of Venezuela’s Argentina foray, said David Mares, a political science professor at the University of California, San Diego. In 2006, late President Hugo Chavez unveiled a plan to transform PDVSA from a commercial company to a domestic and international political tool.

Before oil prices crashed in 2014, Venezuela’s government used PDVSA to fund social programs at home and provide countries in the region with cheap fuel to promote its socialist model and push back on United States influence.

The most well-known example is Petrocaribe, a program through which Venezuela sends crude and fuel to Caribbean countries on generous credit terms or through barter deals. But Chavez also signed deals with governments elsewhere in the region, including Argentina and Uruguay, to sell fuel and invest in energy infrastructure.

“The idea of having a series of gasoline stations in Argentina would fit in that context. It’s to show the Bolivarian revolution benefits people at the ground level,” Mares said. “The surprise is that they’ve lasted so long, because PDVSA is broke, the country is broke.”

PDVSA in 2006 purchased a 46 percent stake in Conosur from Uruguay’s ANCAP, which it boosted to a controlling 94 percent in 2010. PDVSA’s website still boasts of a goal to run 600 stations in Argentina to gain a market share of 12 percent in the country.

Conosur’s struggles come as some of PDVSA’s other overseas ventures, most launched through a wave of overseas expansion in the 1980s or as part of Chavez’s attempts to use “oil diplomacy,” have been scaled back or shuttered.

One of the most emblematic is Hovensa, a refinery in the U.S. Virgin Islands operated jointly with Hess Corp (HES.N), that filed for bankruptcy in 2015.

‘STRATEGIC ALLIANCE’

Since 2013, Conosur has posted hundreds of millions of pesos in annual losses. Fuel sales at its PDV Sur and Sol-branded stations have plunged 86 percent, as it struggled to compete with rivals like state-owned YPF (YPFD.BA), which produce their own crude and refine their own fuel.

PDVSA also strove to become an integrated player in Argentina, but efforts to acquire upstream and refining assets never worked out, the person said.

Neither PDVSA nor PDVSA Argentina, the subsidiary that owns the Conosur stake, responded to requests for comment.

And in a sign of how Venezuela’s economic crisis has derailed its ambitions to challenge U.S. diplomatic and financial power through regional energy integration, Conosur has not notified Argentina’s stock watchdog of any payments from PDVSA since Dec. 29, 2017.

The choice to cut off support amounts to a formal abandoning of the upstream goals in favor of strengthening the existing network as part of a restructuring of the company, said the person, speaking on condition of anonymity because they were not authorized to speak publicly.

“The supports were rational when the goal was the whole supply chain,” the person said, adding the company was in talks for a strategic alliance with a fuel supplier to access cheaper refined products, rather than depending on the spot market.

That deal could be necessary to keep the company alive without PDVSA’s support.

The company posted a 177.5 million peso loss in 2017, and warned on Dec. 20 that PDVSA’s transfers had helped it avoid being dissolved in accordance with the requirements of an Argentine corporate law for companies that run out of capital.

Since then, losses have accelerated, to the tune of 226 million pesos in the first half.

Conosur’s struggles have dashed many employees’ hopes that PDVSA’s takeover would signal a new era of prosperity at the chain, which had also struggled under Uruguayan ownership.

“We saw it as a panacea,” said one former employee, laid off earlier this year with around a dozen others. “But it was more or less the same.”

Additional reporting by Alexandra Ulmer in Caracas and Marianna Parraga in Mexico City; Editing by Bernadette Baum

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Uruguay Electric Grid Reaches Nearly All Citizens

(Energy Analytics Institute, Jared Yamin, 23.Jul.2018) – Uruguay is one of the countries in the Latin American region with one of the highest connection of residents to a national energy grid.

In this small Southern Cone country, the figures for houses without electricity have dropped to a minimum of 0.3%, reported the daily newspaper El Pais.

However, of this small figure there are families scattered throughout the country that under current conditions the electric grid will not reach them over the short term, reported the daily.

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FDI in LAC Region Falls for Third Straight Year

(Energy Analytics Institute, Ian Silverman, 12.Jul.2018) – Foreign Direct Investment (FDI) in Latin America and the Caribbean fell for a third straight year in 2017, reported the Economic Commission for Latin America and the Caribbean or CEPAL by its Spanish acronym.

The details were revealed in CEPAL’s annual report titled “FDI in Latin America and the Caribbean 2018.”

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ANCAP and ALUR Combined $160 Mln Credits

(Energy Analytics Institute, Ian Silverman, 12.Jul.2018) – Two resolutions from the Uruguayan government late last month will authorize Ancap and ALUR to access credits for up to $160 million.

In 2018, Uruguay’s state oil company Ancap plans to overcome its $136 million financial indebtedness by renewing it for an amount of up to $90 million, reported the daily newspaper El Pais.

Additionally, Ancap solicited three loans with banking institutions for up to $70 million for its subsidiary Alcoholes del Uruguay (ALUR) with the purpose of canceling loans due for the same amount, reported the daily.

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Atlas to Invest $114.4 Mln in Uruguay

(Energy Analytics Institute, Ian Silverman, 4.Jul.2018) – U.S. company Atlas Renewable Energy plans investments of $114.4 million in Uruguay.

Atlas announced closing of long-term financing for its two solar plants: Del Litoral and El Naranjal, both located in Salto, reported the daily newspaper El Pais.

The two projects have 238,720 solar panel modules, installed capacity of 75.8 megawatts of power (MWp), and produce 144.3 giga-watt hour (GWh) per year, the daily reported.

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Uruguay to Adopt Process for Offshore Oil Blocks

(Reuters, Luc Cohen, 15.Jun.2018) – Uruguay will move toward a permanent offer process for offshore oil blocks as other Latin American countries have done, after an April auction failed to attract bids, Industry, Energy and Mining Minister Carolina Cosse said in an interview this week.

The tiny South American country had offered up 17 blocks in its first oil auction in seven years, as rising oil prices were renewing companies’ interest in the region. But the legacy of a crash in oil prices that began in 2014 still weighed on their willingness to bid in little-explored areas, Cosse said.

“The oil and gas industry has its cycles and it has demonstrated that predictions are very difficult,” Cosse said on Thursday on the sidelines of the G20 Meeting of Energy Ministers in Bariloche, Argentina.

“Precisely because of those surprising cycles, Uruguay will keep promoting exploration,” she said.

Under the new bidding system, the country will set consistent conditions and leave blocks permanently open to bids from companies. That would differ from previous “rounds” of bidding which each had different conditions, meaning companies had to win approval to present an offer each time, Cosse said.

Companies including Argentina’s YPF, Portugal’s Galp Energia, BP Plc, Royal Dutch Shell , Tullow Oil, Norway’s Statoil and Exxon Mobil are among the companies currently exploring in Uruguay after winning blocks in previous auctions, but so far have not found hydrocarbons.

That lack of success was also a factor in the absence of interest in the most recent round.

With more than 1,000 oil and gas blocks on offer in Latin America – mostly in Brazil – 2018 has been a competitive year for countries seeking energy investments.

But the results of what some analysts have dubbed “Latin America’s energy reform” have so far been mixed, with some countries reaching record bids and others failing to attract bids at all. Few companies have the appetite for the level of geological risk present in a country like Uruguay.

Colombia said earlier this year it would open up a permanent bidding round after completing its first offering of new areas in four years. Brazil has also started moving to a similar process.

(Reporting by Luc Cohen Editing by Frances Kerry)

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Argentina Interested in Buying Excess Gas from Punta De Sayago

(Energy Analytics Institute, Aaron Simonsky, 11.May.2016) – The government of Uruguay continues to move forward with agreements to secure markets for natural gas to come from its proposed regasification plant in Punta de Sayago.

Uruguay’s President Tabaré Vázquez and Industry, Energy and Mining Minister Carolina Cosse, signed a decree that will authorize the approval of a pre-agreement between Uruguay and Argentina for the purchase-and-sale of natural gas produced in Uruguay, reported the daily newspaper LaRed21.

In recent months officials from Argentina have continued to reiterated the country’s interest in acquiring gas from its neighbor Uruguay.

An Interconnection Commission will be formed within 30 days once the countries finally reach an agreement.

The time frame for the purchase of the gas will be 10 years after the regasification plant starts operations.

“It is estimated to start working in the second half of 2017, if Uruguay decides to realize the investment,” reported the daily, citing Cosse.

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ANCAP Says Will Not Reduce Fuel Prices

(Energy Analytics Institute, Aaron Simonsky, 1.Apr.2015) – ANCAP will not reduce fuel prices in April due to the appreciation of the dollar.

According to analysts, ANCAP has a margin of 8 percent in terms of the price of fuels since they are referenced to the price of crude oil, reported the daily newspaper La Red 21.

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Worries Surround Montevideo LNG Plant

(Energy Analytics Institute, Aaron Simonsky, 24.Mar.2015) – Officials in Uruguay are worried about difficulties that have translated into delays at the Montevideo LNG regasification plant.

“Its a very significant project for the country. We continue to advance but we are worried about the difficulties that have arisen, as the delays could eventually affect energy generation costs,” reported the daily newspaper El Pais, citing National Party Director Elena Baldoira.

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Venezuela Financial Scheme for Uruguayan Oil

(Energy Analytics Institute, Jared Yamin, 3.Mar.2015) – Venezuela announced a financing scheme for oil shipments to Uruguay, according to a decree revealed on March 2, 2015 in Venezuela’s Official Gazette newspaper.

Over the short-term 90 days, the payments for the shipments generate interest at a flat 2 percent. Over the long-term, up to 15 years, because of the amortization of capital, there will be a two-year grace period and an annual interest rate of 2 percent.

The financed amounts will be determined by the following (see Table 1):

TABLE 1:

Avg Price⁄bbl —- Determination factor

>- 15 ———- 5%

>- 20 ——— 10%

>- 22 ——— 15%

>- 24 ——— 20%

>- 30 ——— 25%

Source: 1) Avg Annual Sales Price⁄bbl (FOB-Venezuela), 2) Determination factor for financial resources (%). Venezuela Official Gazette

Of the long-term financed portion, at least 50 percent (equivalent to 12.5 percent when the oil sales price is equal to or greater than $30/barrel) can be classified under the Compensation Fund which allows for the exchange of goods and/or services by the government of Uruguay.

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Uruguay Supporting Execution of 27 Projects

(Energy Analytics Institute, Ian Silverman, 13.Sep.2013) – The Uruguayan government is supporting execution of 27 electric projects in rural zones that will span 800 km.

The cost of the projects is estimated at $6.5 mln, of which 40% will be subsidized by the government, reported the daily newspaper El Pais.

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