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Paraguay Proposes $1.5 Billion Gas Pipeline to Link Argentina and Brazil

Paraguay is in advanced discussions with energy firms and government officials from Argentina and Brazil about a proposed $1.5 billion gas pipeline project, aiming to establish a new regional gas flow route.

This project would rival a Bolivian proposal to repurpose existing pipelines for the same purpose.

“We aim to sign a memorandum of understanding at a presidential level for the pipeline in June,” said Mauricio Bejarano, Paraguay’s deputy mining and energy minister. “There is general support for the project.”

The initiative is driven by Brazil’s need for new gas suppliers due to declining production in Bolivia.

Paraguay’s proposal involves transporting gas from Argentina’s booming Vaca Muerta shale region through the Paraguayan Chaco. Initial estimates suggest an investment of $1.2 to $1.5 billion, with partial funding from the private sector.

Paraguay has been actively seeking investors and government support. Recent meetings included Brazilian Energy Minister Alexandre Silveira, who supported further studies on the project’s viability.

The proposed pipeline would span over 1,000 kilometers (621 miles), starting in Argentina’s northern region of Campos Duran, passing through Paraguay’s Chaco, and reaching Brazil’s Mato Grosso do Sul state. It could potentially connect to the existing Gasbol line that supplies Sao Paulo.

While Bolivia, the traditional gas supplier to both Brazil and Argentina, has not commented on the project, Brazil has expressed interest in Vaca Muerta shale gas to meet its energy needs.

“Brazil is the key market,” said energy expert Victorio Oxilia of the National University of Asuncion. “Without Brazilian demand, the project wouldn’t move forward.”

Brazil’s Energy Minister Silveira noted that both the Bolivian and Paraguayan proposals could coexist, providing an additional supply route for specific Brazilian regions.

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