Bolivia–Peru Gas Pipeline

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Bolivia–Peru Gas Pipeline, also known as Bolivia–Ilo Pipeline, is a proposed natural gas pipeline in Bolivia and Peru.

Location

The pipeline would run from YPFB's natural gas hub in Río Grande, Santa Cruz department, Bolivia to Ilo on Peru's Pacific coast.

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Project Details

• Operator: YPFB
• Parent Company: Government of Bolivia
• Capacity: 10 million m³ per day (353 MMcfd)
• Length: approximately 900 km / 559 miles
• Status: Shelved
• Start Year:

Background

In January 2019, the Peruvian government announced that it had launched negotiations with Bolivia regarding the possibility of constructing a pipeline to bring natural gas from Bolivia's Santa Cruz department to southern Peru. In June 2019, Bolivian president Evo Morales and Peruvian president Martín Vizcarra signed a joint declaration listing the proposed pipeline as one of several projects being considered for future development by the two countries.

The proposed pipeline would be built in conjunction with a new gas liquefaction plant and export terminal in Ilo, Peru. The project was conceived as a means to provide new export markets for Bolivian natural gas at a time when Bolivia's existing contracts to supply gas to Brazil and Argentina are set to expire, in 2020 and 2026, respectively. Both Brazil and Argentina have recently begun developing their own natural gas reserves – Brazil in the pre-salt formations off its southeastern coast, and Argentina in the Vaca Muerta shale fields of Neuquén province – creating uncertainty for future agreements with Bolivia.

Gas transported through the new pipeline would initially be sold to customers in southern Peru and eventually exported to China, India, and other Asian countries. Bolivia has also expressed interest in reaching other export markets via an interconnection with Peru's proposed Southern Gas Pipeline.

As of June 2019, Engie S.A. and Kallpa Generation S.A., which operate Southern Peru's two largest power plants in Ilo and Mollendo, had already signed memoranda of agreement with Bolivia's Ministry of Hydrocarbons and the state-owned oil company YPFB to purchase Bolivian natural gas. However, a 2019 survey indicates that 62% of Peruvians oppose the importation of natural gas from Bolivia, with many preferring to develop Peru's own natural gas reserves in the Camisea basin, which are estimated to total 12.9 trillion cubic feet (tcf) vs. Bolivia's 10.7 tcf.

The estimated time frame for constructing the pipeline, which would climb west from the lowlands of Santa Cruz across Bolivia's altiplano before descending to Peru's Pacific coast, is at least three years.

At a bilateral meeting in La Paz in October 2021, representatives of the Bolivian and Peruvian governments agreed to study the economic and technical feasibility of linking the long-planned Southern Peru Gas Pipeline with the proposed Bolivia-Ilo pipeline. The same proposed connection was again discussed in March 2022 during a meeting between Bolivian president Luis Arce and Peruvian president Pedro Castillo.

As of March 2024, there had been no news of the project in more than two years. With Bolivian gas production falling off precipitously and exports to Argentina scheduled to end in June, there appeared to be little chance of the Bolivia-Peru pipeline moving forward.

In July 2024, following the discovery of a huge new gas field with an estimated capacity of 1.7 trillion cubic feet, Bolivian president Luis Arce held out the promise of a "second era of gas exports," implying that future export pipelines might be built. However, pending further notice, the Bolivia-Peru pipeline project was presumed to be shelved.

External articles

Proposed Pipelines in Latin America