Argentina and Brazil signed an energy and gas exchange memorandum until 2025

President Alberto Fernández received at Casa Rosada the Secretary of Energy, Flavia Royon and the Argentine ambassador in Brazil, Daniel Scioliwho signed for Argentina the update of the memorandum, with the Brazilian Vice Minister of Mines and Energy, Hailton Madureira de Almeida, as part of the negotiation.

The memorandum arises as a result of three rounds of negotiations carried out between October and November to update the agreement that was about to expire.

There they also participated Cammesa, company that manages the wholesale electricity market, and the Argentine Foreign Ministry.

Predictability of energy supply

Scioli stated that the objective of the agreement is “to provide predictability and guarantees regarding the supply of energy demanded by industry and households.”

As agreed, the Argentina will continue to supply electricity and gas to Brazila country to which it exported more than US$1 billion of electricity in 2021 and almost US$350 million of gas in various forms so far in 2022.

Meanwhile, this year Brazil guaranteed the maximum capacity to supply electricity to our country at competitive prices for US$250 million, which was possible through the Garabí electrical converters.

“In a context of global uncertainty due to the impact of the war between Russia and Ukraine, there is full conviction that we have to strengthen the local. The greatest possible deepening is the privileged strategic alliance between countries like Brazil and Argentina”remarked the Argentine ambassador.

Likewise, the agreement allows the use of the Bilateral System of Payments in Local Currencies, implemented through the “Agreement on the System of Payments in Local Currency between the Argentine Republic and the Federative Republic of Brazil”, signed on September 8, 2008, aimed at to achieve financial integration.

The understanding provides that Brazil modernize the converter stations garabí mentioned, guaranteeing adequate operation for the next decade.

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Néstor Kirchner pipeline and tariffs

On the other hand, Royón and Scioli informed the President about the progress in financing negotiations of the next stages of the Néstor Kirchner Gas Pipeline.

The Gas pipeline work will have the most important binational impact in history since it will allow the energy integration of Argentina and Brazil to become a reality.

It is in line with this, the company’s teams Argentine Energy (ENARSA)from the Ministries of Economy of Argentina and Brazil, the Foreign Ministries, the Argentine Embassy in Brazil and the National Bank for Economic and Social Development of Brazil (BNDES) launched negotiations to finalize the financing of the next stages.

From the development of unconventional gas reserves in the fields of Dead cow in the province of Neuquén, Argentina will become a net exporter of gas.

In relation to energy rates, royon indicated that they will continue working to “order the tariff system in Argentina, giving certainty, taking care of the service and access to energy. For this we are facing a comprehensive tariff review. It is not an immediate process, but rather it will be progressive and carried out in conjunction with the company to acquire the share package of Edesur”.

Argentina and Brazil signed an energy and gas exchange memorandum until 2025