The Report's View: Given a lack of below-ground potential, Chile suffers from a severe deficit of hydrocarbon supplies and a high dependence on imported energy feedstock. However, the country's leadership recogni s es the unlikelihood of a trend reversal, implementing a new national energy strategy to spur greater development of the sector where possible. The Bachelet administration has continue d Chile's tradition s of a liberal economy, regulatory transparency , and encouragement of foreign investment. Chile's most immediate opportunities lie in the expansion of their liquefied natural gas (LNG) import facilities as a means to meet growing domestic demand . On a longer-term basis, Chile is exploring the possibility of tapping is unconventional resources in the Magallanes region, though we caution its development has grown increasingly unlikely amid a lower oil price environment.
The key trends and developments in the Chilean oil and gas sector:
- Chile's attractive fiscal regime, favourable regulatory environment, and stable macroeconomic growth have been unable to spur significant investment into the country's oil and gas sector due to poor below-ground rewards compared to its regional peers.