83.8 million m³/day of the 143.8 million produced in March were returned to the wells; on the other hand, imports were the highest in 22 months
Brazil returned 58% of national natural gas production to wells in March. It was the highest reinjection percentage in history. During the month, 143.8 million m³/day (cubic meters per day) of natural gas were produced. And 83.8 million m³/day returned to the wells.
In volume, the total reinjected was the 3rd largest. It was below those recorded in November and December 2023. But the percentage in March was a record because natural gas production fell, reducing the difference. On average for the 1st quarter of 2024, reinjection was 54%.
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The data are from ANP (National Petroleum, Natural Gas and Biofuels Agency) and were compiled by Power360. The historical series numbers show that reinjection soared in the country from 2015 onwards, with the start of operation of large pre-salt platforms.
In Brazil, around 85% of the natural gas produced is associated with oil. This is the case with the pre-salt. In other words, both are present in the reservoirs. To produce oil, companies have to extract natural gas. Oil companies are left with two options: sell the gas or reinject it.
The return ends up being a commercial strategy of oil companies, such as Petrobras, to increase oil production. It turns out that the injection of natural gas, carbon dioxide, water and other fluids increases the pressure of the reservoirs, helping to extract the oil. And oil is more profitable than gas.
In countries with a similar production profile to Brazil, with a predominance of associated gas, gas reinjection rates are naturally higher to help extract oil. They vary from 20% to 35%. However, the percentage in Brazil is above its peers. This is because of lack of infrastructure.
While the country rushed to build platforms to extract pre-salt oil, it did not invest enough and in time to transport the gas. As a result, there is currently a lack of gas pipelines to take production to the market and most of what is extracted ends up returning to the wells.
There are only two routes for the flow of pre-salt natural gas production: the Route 1 and Route 2 gas pipelines, which connect the fields to the UPGNs (natural gas processing units) in Caraguatatuba (SP) and Cabiúnas (RJ). These structures play a role similar to oil refineries.
In the case of March specifically, the partial and scheduled shutdown of the Mexilhão platform for preventive maintenance also contributed to the record. This caused restrictions in the supply of gas on Route 1.
Since 2014, Petrobras has been planning the Route 3 maritime gas pipeline to expand the flow of gas production, following the increase in the supply of the input. Delays in construction caused several postponements in the expectation of completion.
The 3rd pre-salt pipeline will lead to the Gaslub Complex – formerly Comperj (Rio de Janeiro Petrochemical Complex), which was resized after Operation Lava Jato. The infrastructure should come into operation by the end of this year and will have the capacity to transport up to 18 million m³/day.
IMPORTS GROW
While natural gas production fell in March and the reinjection percentage hit a record, Brazil increased imports of the input to supply the domestic market. The volume acquired from abroad was the highest in 22 months.
728.6 million m³ of natural gas arrived in the country in March. In February, the imported volume was 538.1 million m³. The increase was due to the increase in landings of LNG (Liquefied Natural Gas), which is transported in liquid form on ships and is then regasified in terminals in the country.
Brazil has always been a large importer of gas due to the difficulty of selling its own production. Monthly volumes purchased from abroad have fallen since 2022, when Bolivia’s supply contract with Petrobras was reduced by 30%.
Until 2022, imports of Bolivian gas through Gasbol (Bolivia-Brazil Gas Pipeline) represented around 70% of the total. With the reduction in deliveries by the neighboring country, Brazil has increased the purchase of LNG from abroad.
Large companies have increased investments in port terminals for imports and regasification. The number of operating terminals, which was 5 by the end of 2022, should reach 10 by the end of 2024.
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