A Canadian producer with international operations has found a growth spot in liquefied natural gas (LNG) traffic by using new technology on land in Colombia instead of venturing into the high-cost overseas export tanker trade.

Canacol Energy Ltd. announced making a small start in LNG production and sales on a planned network of Colombian inland terminals and deliveries. Company market studies show potential for 60-fold volume growth with initial deliveries of 2.4 MMcf/d.

Canacol reported LNG stands out as a competitively priced substitute for current Colombian consumption of 145 MMcf/d of expensive compressed natural gas (CNG) and propane.

The Canacol operation is a pioneer foray into making LNG at wells. The initial Colombian service uses four compact gas refrigeration modules known as Cryoboxes, each about the size of marine and railway freight containers.

Negotiations are underway with the system’s developer in Argentina, Buenos Aires-based Galileo Technologies, for a joint venture in building up Colombian LNG services, said Canacol.

Limited pipeline capacity in Colombia has fostered residential, industrial and commercial reliance on long-distance trucking of CNG, propane, diesel and fuel oil, according to the company.

Colombia’s consumption pattern created a ready market for cheaper and “cleaner” fuel, it said. The firm estimated LNG only costs one-third as much to transport as CNG. The saving results from packing high volumes of deep-frozen gas into delivery trucks.

The new LNG service taps growing supplies developed by the Calgary firm.

Canacol’s 3Q2019 results showed a 27% jump in Colombian gas sales to 146.5 MMcf/d from 115.3 MMcf/d a year earlier, enabled to date by regional pipeline additions.