The Latin American and Caribbean Energy Organization (OLACDE) and CAF – Development Bank of Latin America and the Caribbean – held the event “Gas Integration in MERCOSUR + Chile: Towards a Regional Market” in São Paulo, bringing together representatives from governments, energy companies, regulatory authorities, and international organizations across the region.
During the opening session, Guido Maiulini, Head of Strategic Advisory at OLACDE, stated: “In an international environment that is increasingly volatile and uncertain for energy markets, South America has a historic opportunity to advance toward deeper integration, based not only on infrastructure but also on regional coordination, regulatory convergence, and mechanisms that expand cross-border gas trade. We are talking about regional gas exchanges worth up to USD 5 billion annually and an investment portfolio exceeding USD 25 billion. This will not only strengthen energy security but also provide more competitive, accessible, and sustainable energy for our industries and households.”
Marcello Gomes Weydt, Director of the Natural Gas Department at Brazil’s Ministry of Mines and Energy (MME), emphasized: “Gas integration is strategic for countries seeking not only to monetize their energy resources but also to achieve competitive natural gas prices for consumers. In doing so, we can effectively drive regional economic development by increasing the competitiveness of energy-intensive industries, and this is the path Brazil is pursuing.”
Juan Carlos Elorza, Director of Technical and Sector Analysis at CAF, noted: “The challenge today is no longer to think about national projects in isolation, but to move toward a regional architecture capable of building a true gas market. This cannot be achieved by a development bank alone; it requires information, institutions, and dialogue among those who produce, transport, and consume energy, while creating the conditions necessary to attract long-term investment. That is why CAF supports studies and dialogue platforms that help transform this vision into concrete action.”
Sylvie D’Apote, Executive Director of Natural Gas at the Brazilian Institute of Oil, Gas and Biofuels (IBP), added: “Access to multiple sources of supply and stronger regional interconnections enhances the resilience of energy systems against international, climatic, or supply shocks. In addition, natural gas plays a strategic role in supporting the expansion of renewable energy and facilitating the region’s energy transition.”
Throughout a series of technical sessions involving both public and private sector stakeholders, OLACDE presented 10 regional integration corridors linking natural gas production and consumption centers across Argentina, Brazil, Bolivia, Chile, Uruguay, and Paraguay. The alternatives include expansions and upgrades to existing infrastructure such as Gasoducto Norte, GasAndes, Centro Oeste Pipeline, GNEA, Tratayén–La Carlota, Uruguaiana connections, Duque de Caxias–Taubaté, Siderópolis–Porto Alegre, San Jerónimo–Porto Alegre, as well as projects associated with the Bioceanic Gas Pipeline and new regional interconnections between Argentina, Bolivia, and Brazil. Together, these initiatives involve approximately 6,000 kilometers of pipelines and more than 1 million horsepower of compression capacity, with estimated investments ranging from USD 500 million to USD 5 billion per corridor, exceeding USD 25 billion overall.
The projections highlight the complementarity between the expansion of Argentina’s Vaca Muerta formation and Brazil’s Pre-Salt development, alongside growing gas demand in São Paulo, Brazil’s Center-West region, and the country’s southern states. Simulations indicate that, with adequate infrastructure, regional export flows could reach between 35 and 40 MMm³/day under current demand conditions and exceed 60 MMm³/day under regional growth scenarios. Greater integration would also reduce supply costs, increase regional exports, optimize existing infrastructure, and decrease dependence on LNG, diesel, and electricity imports. The project further identifies opportunities to support gas-intensive industries such as nitrogen fertilizer production, steelmaking, and baseload power generation, particularly along the Bioceanic Corridor linked to Paraguay’s Chaco region, where initial demand is projected at 4 MMm³/day with significant growth potential.
The findings indicate that the viability of several corridors also depends on long-term firm contracts and regulatory frameworks capable of providing predictability and attracting infrastructure investment. Discussions addressed regional gas transit through Bolivia, transport redistribution, and new tariff structures in Argentina, as well as tariff flexibility mechanisms and the use of already amortized infrastructure. Variations in transport tariffs and regulatory conditions could significantly affect the competitiveness of regional routes and cross-border trade flows.
Finally, different regional integration scenarios were presented, showing that under greater tariff flexibility and increased regional demand, MERCOSUR countries and Chile could achieve regional natural gas trade flows of between 60 and 70 MMm³/day, representing an estimated market value of approximately USD 5 billion annually. Aggregate regional benefits, including supply cost savings and transit revenues, could range between USD 900 million and USD 2 billion per year, depending on the scenario. The study concludes that deeper regional integration would strengthen Southern Cone energy security, reduce exposure to external shocks in energy markets, and create favorable conditions to support the region’s energy transition and industrial development.
The event concluded with four public panels addressing the role of gas integration in the global geopolitical context and regional energy security, the regulatory changes required to advance a regional natural gas market, the structure of the value chain, and risk allocation needed to enable long-term investments, and the role of Brazilian demand in consolidating a more integrated regional market. Government representatives, industry leaders, regulators, and international experts agreed on the need to strengthen technical and regulatory coordination, improve investment predictability, and advance mechanisms that expand regional trade and reinforce Southern Cone energy security amid growing uncertainty in global energy flows.
