Paraguayan president Federico Franco recently announced that the Alto Paraná region of the South American country may have the largest natural gas reserves in Latin America. President Franco had presented the local farmers with agricultural equipment such as covers for gardens that reduce solar heat and preserve soil moisture. These half shadow covers will enable local farmers to increase their vegetable production and use less water.
President Franco said in his statement that a number of proposals have been received from international oil companies that are interested in drilling in the dry Chaco region in northern Paraguay. In addition to this, there is also the presence of the largest gas reserves in the area of Juan Leon Mallorquin and Juan O’Leary. This marketable gas will enable the locals to secure a steady income and better living conditions. According to President Franco, the city of Juan O’Leary and city of Juan Leon Mallorquin will generate a revenue that would exceed that of Itaipu Bi-national hydroelectric dam, which is administered by Paraguay and Brazil.
On April 26, 1973, Paraguay and Brazil signed the treaty for the development of a major hydroelectric project that would belong to both countries and generate electricity on the Parana river, nearby the opening of Yguazu River at Ciudad del Este, which is considered the commercial capital of Paraguay. Since then Itaipu has been considered to be the ATM machine of the Paraguayan state together with the Yacyreta Hydroelectric Dam, whose administration and profits are shared with Argentina.
President Franco is confident that when the day of exporting natural gas from Alto Parana, this region will be the wealthiest area of the republic, he also added that “it is also important to protect and maintain a healthy soil for organic agricultural products”
In 1992-93, were drilled three exploration wells in the district of Juan León Mallorquín; the first, named Majorcan I, was undertaken by Texaco, and the other two others were led by Guarani. During the examination of the drilling well named Inés II, engineers had announced positive results and they had found five types of marketable pentane gas; this initiative proved to be a great technological accomplishment, 20 years ago, and only recently is being rediscovered with the hope to use these natural resources for the benefit of the local people.
Once the natural gas and crude oil is exported from Alto Parana to neighboring Brazil, the potential income generated from such resources is expected to change the lives and economy of the still largely agricultural Paraguay.