In this way, the country’s Central Bank will save the investment of US$156 million next month.

 

The state-owned company Energía Argentina (Enarsa) decided to cancel three awarded cargoes of liquefied natural gas (LNG) that were scheduled to arrive in August. Thus, Argentina’s Central Bank will have a foreign currency relief of US$156 million next month. La Nación reported that by selling the operation, it will receive an income of US$46.8 million.

 

This year, Enarsa awarded a total of 38 vessels (discounting the three decommissioned ones) for a total of US$2,769 million. Last winter, the state-owned company purchased a total of 51 LNG cargoes for a total cost of US$1.1 billion, but at average gas prices of US$8.33 per million BTU.

 

The end of the pandemic triggered gas prices even before the conflict in Ukraine broke out, which added to the lower investments in gas production in Argentina affected supply. Thus, in 2022, the LNG price averaged US$27 per million BTU, which meant that, despite having purchased fewer cargoes, prices paid more than doubled those of last year.

 

“Temperatures were higher for this month. The average for July was 10 degrees and we had an average of 12 degrees, which helped to reduce demand and free up LNG imports”, official sources explained, according to La Nación.

 

The three vessels to be imported were destined for the port of Escobar, which has a regasification capacity of 22 million cubic meters per day (m3/d), higher than the 15 million m3/d capacity of Bahía Blanca. In addition to saving the US$156 million payment for the three vessels, Enarsa sold the operation to a trader for US$46.8 million.

 

In the event of an increase in energy demand, Enarsa is negotiating with Brazil to reinforce the import of electric energy, in order to capture opportunity offers for August. In case there is a need for energy, imports from Brazil would imply a lower cost than LNG.

 

The international increase in gas and diesel prices hit the reserves of the Central Bank, which could not take advantage of the increase in the same proportion of commodity prices.

 

Miguel Pesce, president of the BCRA, indicated that in August, energy imports will decrease from US$2,000 million per month in June and July (higher demand due to low temperatures) to around US$800 million.

 

In detail, in the first semester, Argentina imported US$6,609 million of fuels and lubricants, when in the same period last year, it had imported US$2,281 million. This implies an increase of 190%, according to the latest Argentine Trade Exchange Report (ICA) of the Indec.

 

In the month of June, in particular, energy imports reached US$1,953 million, of which diesel accounted for US$719 million; liquefied natural gas (LNG) ships, US$662 million; gas from Bolivia, US$198 million, and fuel oil, US$97 million. The main supplier countries were the United States, India, Saudi Arabia, the United Arab Emirates, and the Netherlands.

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