Most industrial and post-industrial economies have energy policies that attempt to offer their citizens some form of energy security, that is, reliable energy supplies at affordable prices. The success or failure of energy (security) policies depends upon energy supply and the associated energy infrastructure. Ideally, a jurisdiction has adequate energy supplies with an infrastructure that allows the supplies to be distributed so that energy demand is met. However, the loss of supply, the loss of infrastructure, or the simple lack of infrastructure can jeopardize energy security.
As more countries become “energy poor” through declines in domestic supplies of energy (primarily fossil fuels), existing investments in energy infrastructure are forcing these countries to rely on “energy rich” suppliers. The U.S. is a good example of how declines in continental supplies of natural gas are driving the demand for LNG. Europe’s vast natural gas network is driving its search for sources of natural gas (other than Gazprom and Russia).
Recent examples of how the loss of supply impacts energy security have included Russia cutting supplies of natural gas to Ukraine (2005-06) and Russia cutting supplies of oil to Lithuania (2007).
The following two articles show how Argentina’s need for natural gas has resulted in supply shortages in Chile. Chile’s investments in its natural gas infrastructure will force it to search for other sources of natural gas, domestic or foreign.
Chile Natural Gas Shortage May Worsen in 2007, GasAtacama Says
Matthew Walter, Bloomberg
GasAtacama SA, a Chilean utility and gas pipeline company that supplies electricity to the World’s biggest copper miners, expects increased cuts of natural gas from neighboring Argentina this year.
…Chile’s natural gas shortages began in 2004 as Argentina, which supplies almost all of the country’s gas, started reducing shipments to meet domestic demand. Argentina yesterday halted gas exports, forcing Chile to use backup fuel stored in a pipeline between the two countries to provide heating and cooking fuel to Chilean homes.
(29 May 2007)
Chile on Edge as Argentina Curtails Gas Shipments
Nathan Crooks, The Santiago Times
Chilean government authorities and citizens alike worried Tuesday that the country could soon be “left in the cold” after Argentina once again suspended all natural gas exports to Chile. Due to the severe cold wave affecting both Chile and Argentina, Argentine authorities closed the trans-Andean natural gas duct Monday and redirected the gas toward Buenos Aires where demand for residential heating has increased.
Natural gas still currently remains in the pipeline, but Chile may face a widespread residential cut if the supply is not quickly re-established. Government authorities said present gas supplies would meet the demand for water heating and cooking, but warned that not enough gas would be available for residential heating.
(30 May 2007)
