Griselda Ascanio keeps a makeshift wood stove in the backyard of her home in Maracay, 120 kilometers from the Venezuelan capital, Caracas, to cope with frequent gas outages that make cooking difficult.
“We can’t just cry about it,” said the 44-year-old manager, who collects branches that fall from trees for firewood. “This way we learn to solve problems ourselves.”
Despite having the world’s eighth-largest natural gas reserves and the largest in Latin America, Venezuela has seen its production fall by nearly half since 2016, according to data from consultancy Gas Energy Latin America.
A resumption of production would not only ensure more reliable domestic supply, but could also alleviate shortages in neighboring countries and generate much-needed hard currency revenue.
The gas issue is a key issue as the July 28 presidential election approaches. The winner will face the daunting task of securing investment in the sector.
The government of President Nicolás Maduro has doubled the supply of gas projects to foreign companies since last year, but long-standing unpaid debts to many companies, U.S. sanctions and the huge investment required have limited progress.
The main opposition coalition, represented by Edmundo González, has proposed radically expanding the role of the private sector and, at the same time, restructuring the country’s $150 billion debt, which analysts say would take years.
“No one is going to produce gas on a large scale in Venezuela under these conditions, but there is immediate interest in small-scale projects,” said Antero Alvarado, managing partner of Gas Energy Latin America, referring to pipelines and systems to improve the capture and distribution of gas.
Venezuela’s problems have hampered development, leading to frequent shortages of essential fuel for cooking, generating power and powering petrochemical plants and factories.
The gas that Griselda receives intermittently at her home arrives in cylinders whose distribution is controlled by government-backed groups.
This subsidized gas is among the most expensive fuels produced by PDVSA refineries. Sometimes the state company even resorts to importing this gas.
Neighbors from Colombia to Brazil and several European countries, hoping that Venezuela’s production could eventually ease their own gas deficit, have pushed the United States to grant sanctions exemptions to gas projects, company executives and government officials said.
PDVSA and its gas subsidiary did not respond to requests for comment.
Venezuela’s nearly 200 trillion cubic feet of proven gas reserves are largely untapped. About 80 percent of Venezuela’s gas production is associated with crude oil production.
Source: Terra
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