Colombia due expanded gas distribution network

Canacol Energy Ltd., Calgary, has entered an agreement with Promigas SA ESP, Barranquilla, Colombia, to expand existing gas transportation and sales to Colombia’s Caribbean coast by an additional 100 MMcfd.

To be fully funded by Promigas, the expansion project will increase Canacol’s current gas distribution network to the Caribbean coast of Colombia by yearend 2018 to an overall 190 MMcfd, Canacol said.

Due to begin this month, the expansion project will involve up to 18 months of permitting followed by 6 months of construction, with first new gas delivery scheduled by December 2018, the company said.

Alongside a twinning of the existing Jobo-Sincelejo gas pipeline, the expansion project will include installation of additional compression on the existing Sincelejo to Cartagena pipeline, as well as construction of a 50-MMcfd gas pipeline between Cartagena and Barranquilla, to result in 100 MMcfd of capacity between Canacol’s more-than 180-MMcfd gas processing plant at Jobo and Cartagena.

To support the expansion, Canacol said it also has completed the negotiation of 100 MMcfd of take-or-pay gas sales contracts with existing and consumers on Colombia’s Caribbean coast, details of which will be released at a later date.

Neither Canacol nor Promigas revealed financial details of the agreement.

Canacol previously expanded its gas processing capabilities at the Jobo station to 60 MMcfd from 25 MMcfd in December 2015, with additional expansion work on the second train completed in January to bring processing capacity to 85 MMcfd, the company said in a Feb. 16 press release.

A final expansion of the plant, completed in March, raised Jobo processing capacity in excess of 185 MMcfd, Canacol said.

The processing and pipeline capacity expansions come as part of Canacol’s plan to boost production and supply of gas to Colombia’s Caribbean coast to help solve epic shortfalls in regional gas supplies, Canacol said in Oct. 27 presentation.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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