Paraguay pushes $1.5b gas pipeline project to rival Bolivia’s dominance

Paraguay is emerging as a potential gas corridor in South America, proposing a $1.5 billion pipeline project to connect Argentina’s booming Vaca Muerta shale gas reserves with Brazil, Reuters reported on Tuesday.

This initiative, detailed for the first time by Reuters, seeks to compete with a rival Bolivian bid to re-purpose existing pipelines for the same objective.  If successful, either project would mark a significant shift in regional energy flows.

Paraguay’s Vice Minister of Investment Rodrigo Maluff emphasised the appeal of Argentina’s Vaca Muerta shale as a potential gas source, given Bolivia’s declining production.

The estimated $1.2-1.5 billion construction cost would be partly financed by private investors, as per the statement.

Meanwhile, governments and companies from Argentina and Brazil have been negotiating with Bolivia since 2023.

Their proposed solution focuses on reversing the flow direction of Bolivia’s existing pipeline network, seen as a faster and cheaper option.

In recent months, Paraguayan officials have actively engaged with potential investors in Sao Paulo, Brazil’s energy minister, and representatives from Argentina.

Energy companies Tecpetrol and Pluspetrol, holding significant stakes in Argentina’s shale gas production, reportedly participated in these discussions.

The initial pipeline capacity is estimated at 15 million cubic metres per day. While Brazil’s Mines and Energy Minister Alexandre Silveira expressed support, he emphasiaed the need for further feasibility studies before committing.