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Global Energy Ventures appoints country associate to support CNG strategy in Brazil

Published: 21:33 03 Jul 2019 EDT

Hull of CNG Optimum ship
The company’s CNG strategy incorporates use of the CNG Optimum 200 ship

Global Energy Ventures Ltd (ASX:GEV) has appointed a country associate to help identify, evaluate and develop prospective Compressed Natural Gas (CNG) projects in Brazil which can benefit from GEV’s CNG solution.

The appointment of GAIA Importação e Exportação Ltd will provide GEV with local expertise to advance corporate and regulatory discussions for CNG projects in Brazil.

Brazil represents an ideal target for a marine CNG project given it has significant offshore associated gas production in close proximity to a large, well-priced gas market.

READ: Global Energy Ventures has upcoming catalysts in Compressed Natural Gas strategy

GEV’s executive director and chief development officer Garry Triglavcanin said: “We are delighted to appoint GAIA as our Brazil country associate given their extensive experience and network in the Brazilian petroleum industry and also domestic government contacts.

“It is critical to the success of our CNG projects that we have the right local partner to drive discussions with operators, gas buyers and regulatory agencies.

“We are really excited by the multiple Brazilian opportunities qualified for marine CNG to deliver offshore producers with a commercial solution for their associated gas production.”

Shares were up to 22.5 cents in early trade, up 7% on yesterday’s close.

Prolific offshore regions

In recent months GEV has met with several offshore oil and gas producers and developers in the Santos and Campos basins who are seeking a solution to monetise associated gas.

These are prolific offshore regions containing multiple billion-barrel oil & gas fields, with an estimated 1 billion cubic feet per day (30 million m3/d) of associated gas being reinjected.

Target oil fields with associated gas within 300 kilometres of Rio de Janeiro/São Paulo. (Source: Woodmackenzie Upstream Data, 2019)

GEV believes there are multiple opportunities to utilise its marine CNG transportation of associated gas solution as a commercial alternative to the implementation of gas re-injection.

READ: Global Energy Ventures selects CNG Optimum 200 ship construction partner

This week’s agreement with a Chinese shipyard to build the company’s CNG Optimum 200 ship brings this solution closer to implementation.

The appointment of GAIA as country associate will ensure GEV is adequately advised on the relevant federal and local government agencies as well acting as a liaison with offshore oilfield operators.

GEV also executed a marketing agreement with GAIA that will provide a success fee to be paid based on gas sales volumes transported by CNG Optimum ships with GEV retaining 100% control of CNG project development.

GAIA is focused on the deployment and service of offshore technologies as well developing engineering solutions, joint ventures and consulting with national and foreign companies operating in Brazil.

“A commercial solution”

GAIA president Luiz G Bodanese said: “We are very proud to be appointed to this position on behalf of GEV and are eager to progress the development of a CNG solution for our clients in Brazil.

“The GAIA team has evaluated many different gas options for the region, and we believe GEV’s CNG Optimum ships will offer operators a commercial solution to transport and monetise their associated gas where it is otherwise typically reinjected.”

Brazil currently imports natural gas from Bolivia and LNG at spot prices across three LNG receiving terminals and its growing energy consumption relies on thermoelectric to supplement hydroelectric baseload shortfalls.

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