Our Partner Diogo Nebias commented to Valor Econômico on the results of the Federal Government's first natural gas auction, conducted by PPSA and CCEE.
All 110 lots were sold: 1.1 million m³/day sold to 23 of the 36 qualified companies, raising R$ 377 million. Demand responded to the cheaper input. The underlying question is structural: why did industry need a public auction to access gas at a competitive price?
In practice:
- The result reveals a shortage of supply. In Diogo's view, the success of the auction demonstrates the lack of natural gas at competitive prices for large industrial consumers.
- The concentration has an economic cause. Gas projects require high investment, especially those involving the installation of offshore platforms. Few investors operate in the sector.
- PPSA is now operating as an instrument of public policy. In his words: "Through PPSA, under a strategy established by the MME and ANP, the government is trying to work around the problem of concentration, including in supply, by seeking to offer natural gas at more competitive prices to encourage industry to consume it, reducing energy input costs."
As Diogo sums it up, the auction is the government's response to concentration in gas supply. For industry, the test lies in the coming rounds: turning a one-off auction into competitive and predictable supply.
