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Analysis

Brazil's Minister of Mines and Energy Strengthens Ties with Argentina at the G20 Rio Summit

Jessica Rapson and Peter Ma, G20 Research Group
November 19, 2024

At the G20 summit in Rio, Alexandre Silveria, Brazil’s Minister of Mines and Energy, elaborated on the Memorandum of Understanding signed with Argentina on the morning of November 18 to strengthen bilateral cooperation in the natural gas sector. The agreement aims to develop infrastructure and interconnectivity to facilitate the export of Argentinian natural gas, particularly from the Vaca Muerta gas fields, and establishes a working group to assess the measures necessary to achieve this goal.

Minister Silveira highlighted the potential for significant economic benefits from this partnership, projecting a demand for 30 million cubic metres of natural gas per day in Brazil by 2030. Currently, natural gas comprises just 12.2% of Brazil’s energy matrix, but the increased supply is expected to support key industries, especially the production of nitrogen-based fertilizers. These fertilizers are vital for Brazil’s robust agricultural exports, reinforcing food security and driving down food costs domestically.

During the press briefing, Minister Silverio emphasized the country's already high share of renewable energy, such as green hydrogen and ethanol, in ways that assist and sustain existing industries such as agriculture. He argued that Brazil’s natural gas expansion aligns with its national interests as a developing country, balancing economic development with environmental responsibilities.

Minister Silverio repeatedly stressed the importance of natural gas in energy transition. He said a common denominator of energy is needed to fuel the current energy transition, and Brazil believes natural gas is such an energy source. Brazil needs a safe and reliable energy supply while the wider green energy transition is underway. Natural gas is important as it offers a safe and reliable source of energy that bridges the gap between fossil fuels such as coals and renewable sources, allowing Brazilian industry, agriculture and economy to grow unabated as the world transitions towards green and renewable energy.

Minister Silverio stressed that Brazil is pursuing a pragmatic approach to energy cooperation, arguing that Brazil wishes to develop strong relations with all countries, such as the United States, the European Union and China – and that relations with one country need not compromise relations with another. This doctrine will guide Brazil’s energy exporting policy through companies such as Petrobras, supplying any country with demand for energy and will only stop once demand for such energy ceases to exist.

Minister Silverio also highlighted the need for food security and energy self-sufficiency, which he argued was necessary for Brazil’s sovereignty. He said that increasing natural gas imports from Argentina, as well as strengthening Brazil’s agricultural sector, as key to maintaining Brazilian sovereignty.

However, questions remain about whether reliance on Argentinian imports will bolster agricultural security or create vulnerabilities to supply chain disruptions. The timing of the agreement, in the wake of Argentina’s President Javier Milei’s last-minute decision to join Brazil’s Global Alliance Against Hunger and Poverty after initially snubbing the proposal, reflects complex geopolitical dynamics, including Brazil’s ongoing efforts to position itself within the Global South.

Jessica Rapson is a senior researcher with the G20 Research Group and a machine learning engineer with a multidisciplinary background in both statistical science and public policy.

Peter Ma is a researcher with the G20 Research Group, and a third-year student at the University of Toronto majoring in political science and international relations.

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