Argentina Rations Gas to Industrial Consumers Amid Shortage

Argentina, South America’s second-largest economy, is rationing natural gas as winter in the Southern Hemisphere boosts demand amid a seven-year shortage of the fuel.

Supplies to industries, which were cut yesterday, “will return to normal once the current cold wave is over,” Planning Minister Julio De Vido was quoted as saying in a statement on the presidential website. Companies can avoid being subject to rationing by agreeing to pay higher prices, he said.

The government is allowed to restrict gas deliveries under supply contracts with industrial users, which it “does every year when the cold starts,” Planning Ministry spokesman Horacio Mizrahi said today in a telephone interview from Saudi Arabia, where he is on a government energy trip.

Argentina has faced energy shortages since 2004 as price caps curtailed investments and demand surged as the economy grew an average 8.5 percent between 2003 and 2008. YPF SA operates two re-gasification ships in Argentina, one of which started this year, to process imported gas in a bid to help meet demand.

More than 300 companies, including Dow Chemical Co. and Siderar SAIC, were affected last year by gas shortages in the winter, which runs from June to September in the Southern Hemisphere. Some 300 companies were affected yesterday by gas rationing, newspaper Cronista reported today, citing unidentified people in the industry.

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