MercoPress. South Atlantic News Agency

Petrobras chief supports trans-continent gas pipeline

The director of the Brazilian government owned gas and energy agency Petrobras, Ildo Sauer, said that Venezuela has enough gas and that the project could achieve the financial unification of the subcontinent.

"The project is a great idea" Sauer said at a petroleum industry event in Rio do Janeiro, according to the state news service Agencia Brasil.

Energy experts inside and outside Brazil have severely questioned the "Pharaonic" project intended to ship 200 million cubic meters of Venezuelan natural gas per day to the extreme south of the continent through a pipeline 8,000 kilometers long.

The Brazilian government estimates that the project under assessment by experts from the three countries would cost between 15 and 23 billion US dollars.

"Whoever says the gas pipeline is unviable has the math wrong or doesn't know the gas industry and its fundamentals", said Sauer pointed out Agencia Brasil.

He underlined Siberian gas is pumped more than 8,000 kilometers to supply Europe with similar volumes of gas and in conditions much more difficult than those in South America.

Critics argue the projected gas pipeline would cause serious environmental damage along its path through the Amazon rain forest, besides the fact that the South American market is insufficient to justify a capital investment of such size and expense.

Almost every country of the region has natural gas in more advantageous conditions and cheaper to extract.

Venezuelan gas wouldn't reach Argentina until 2012, Sauer said to refute the supposed political risk of an undertaking that would make other countries dependent on Venezuelan gas.

"Nowadays whoever bets against integration turns out to be wrong. That was the case of the United States' opinion about the pipeline that sent Russian gas to Germany and France" Petrobras chief underlined.

Critics of President Hugo Chavez's project warn that Venezuelan gas will have to be highly subsidized in order to be able to compete with Bolivian gas on the Brazilian market and with the extremely low prices of the Argentine market.

President Chavez believes the proposed web of pipelines will be accompanied by industrial projects which will expand and diversify demand for natural gas.