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Shale Play Pushes Argentina Oil Output To All-Time High

By Irina Slav - Apr 09, 2026

A year ago, any news about rising oil production anywhere would only serve to make oil traders more bearish on the commodity amid persistent talk of a massive glut. Now, any news of more supply is a welcome change in a world suddenly dominated by reports about fuel rationing and the very real possibility of severe oil shortages. Enter Argentina.

Argentina’s crude oil production hit 847,000 barrels daily earlier this year as the country doubles down on the largest shale oil and gas formation outside the United States, the Vaca Muerta. Thanks to that play, Argentina could see its output grow to 1 million barrels daily by 2030, according to Argentina’s energy industry association.

The February daily average was a 15.9% increase on the year, but the increase in output from the main producing region in the Dead Cow formation, the Neuquen Basin, was a whopping 30.4%, with the total produced there representing 77.4% of the national total, which is fast turning Argentina into the newest member of the global oil exporters’ club.

“The rise in Brent crude prices due to the conflict in the Middle East has had a direct and positive impact on Argentine exports. In this context, the country has a strategic opportunity to advance liquefied natural gas development and position itself as a secure supplier for Asia and Europe,” an Argentinian consultancy wrote in a report on the country’s energy industry, as cited by UPI.

According to an economist from the Institute of International Finance, Argentina’s oil fortunes could remain good as long as the state can convince investors that the legal framework for the energy industry will remain robust regardless of future changes in governments. “The shift is more structural than cyclical, driven by unconventional oil exports from Vaca Muerta,” Martin Castellano told the Buenos Aires Times, noting that higher international oil prices were driving additional revenues from oil exports, to the tune of $1.7 billion for every $10 increase in the price of a barrel of crude.

In other words, Argentina’s energy future looks bright. Yet this has not meant that Big Oil is flocking to the Vaca Muerta. In fact, Exxon exited the formation two years ago, cashing in on the play’s growing popularity while it focused on other assets, such as Guyana. Shell was also reported, earlier this year, to be considering a sale of its assets in the Vaca Muerta play, despite the surging production there.

It has also turned Argentina into the fourth-largest oil producer in Latin America—a position that may improve in the future as the government prioritizes the development of the local energy industry, encouraging infrastructure projects aiming to boost the offtake capacity of the Vaca Muerta. It was the lack of pipeline infrastructure that discouraged some Big Oil players from staying in the play. Those who did stay, led by Argentina’s own state-owned YPF, are now reaping the benefits. The biggest of these projects, the Vaca Muerta South pipeline, connecting the play to the Atlantic coast, should be operational by next year, boosting the country’s oil export capacity by an initial 180,000 barrels daily, eventually expanding to 700,000 barrels daily.

Vaca Muerta has been dubbed the Argentinian Permian, although its geologic properties have been compared more appropriately to the Eagle Ford. Some experts disagree and insist the Vaca Muerta is closer to the Permian in terms of geology. The shale play is estimated to hold recoverable resources consisting of 16 billion barrels of oil and 308 trillion cubic feet of natural gas. Those numbers make the Vaca Muerta the world’s second-largest shale gas deposit and the fourth-biggest shale oil resource.

Shale Gas Could Make Argentina Major LNG Exporter

By Tsvetana Paraskova - Jul 10, 2025

Huge shale gas reserves are laying the foundations of pipeline and LNG exports out of Argentina, which could make South America’s second-largest economy a major force in regional and global gas supply.

Argentina has the resource base—the vast unconventional reserves in the Vaca Muerta shale basin in the Neuquen province. But it needs to build up infrastructure to ship the gas from supply centers to interstate regional pipelines and planned LNG export facilities. Argentina also needs to continue with the market reforms launched by business-friendly president Javier Milei to attract foreign investment and reverse decades of investors shunning the country due to economic and fiscal instability.

On its quest to become an LNG exporter, the country will also face stiff competition from the world’s biggest LNG exporters who have low cost of supply.

Argentina could see its natural gas production peak at 180 million cubic feet per day (Mmcd) by 2040 under a base-case scenario, with the potential to reach as high as 270 Mmcd if the country successfully develops all its planned LNG export projects, Wood Mackenzie said in its latest outlook on the country’s gas and power markets.

Key to the jump in gas supply will be the unconventional fields in Vaca Muerta.'

“With Bolivian exports set to cease by the end of this decade, Argentina is strategically positioned to become the leading regional supplier,” said Javier Toro, Senior Research Manager at Wood Mackenzie.

“At the same time, Argentina has a real opportunity to establish itself as a credible LNG exporter on the world stage.”

Vaca Muerta Shale Output Soars

Oil and gas production in Vaca Muerta has jumped in recent months and the country is now looking at the next step of the resource boom—exporting its huge hydrocarbon resources.

Vaca Muerta—Spanish for ‘dead cow’—has been dubbed the Argentinian Permian, although its geologic properties have been compared more appropriately to the Eagle Ford.

The shale play is estimated to hold recoverable resources consisting of 16 billion barrels of oil and 308 trillion cubic feet of natural gas. Those numbers make the Vaca Muerta the world’s second-largest shale gas deposit and the fourth-biggest shale oil resource.

In the first quarter of 2025, Vaca Muerta built on last year’s strong production performance, with oil output surging 26% and gas production rising 16% year-on-year, Rystad Energy has estimated.

Gas Export Opportunities

Argentina is already interconnected via pipelines with Chile, Uruguay, and Bolivia. The northern pipeline flows have been recently reversed, allowing Argentina to deliver gas to Brazil through existing Bolivian infrastructure. Argentina could also boost pipeline gas exports by extending a connection from Uruguaiana to Porto Alegre and into Brazil’s integrated transport system, Wood Mackenzie reckons.

Argentina has several LNG export projects in the works. Domestic energy company YPF has signed agreements with international majors Shell and Eni to enter the project development of the Argentina LNG project, which includes gas production from Vaca Muerta gas blocks and its transportation through pipelines. These pipelines will extend 580 kilometers (360 miles) to a processing and liquefaction terminal to be built in Sierra Grande, Rio Negro, on the Atlantic coast.

Argentina has already taken final investment decision (FID) on a floating liquefaction facility with a capacity of up to 2.5 million tonnes per annum (Mtpa). It is also evaluating an additional 3.5 Mtpa unit under the Southern Energy consortium consisting of Pan American Energy, Pampa, Harbour Energy, YPF, and Golar.

If all planned LNG projects proceed, Argentina could be exporting up to 28 Mtpa of LNG by 2035, according to Wood Mackenzie.

Infrastructure and Cost Challenges

Despite the huge resources and initial commitments from foreign majors, Argentina’s LNG export future is not guaranteed. The country needs billions of U.S. dollars of investment in midstream infrastructure to carry the gas from the Vaca Muerta fields to export facilities.


“For LNG development, Argentina needs dedicated pipelines to liquefaction facilities and scaled upstream production capacity,” WoodMac says.

Interest in Argentina’s top shale play has increased since Milei took office a year and a half ago.

But the new government has also announced an end to state financing for pipelines and other infrastructure projects. So companies have to rely on private investment and tax breaks and other incentives in the new free-market approach to the economy.

Argentina could be a major gas exporter if it maintains the reforms momentum.

Milei’s government has enacted new legislation, the so-called Large Investment Incentive Regime – or RIGI, by its Spanish initials – offering tax breaks and other incentives for major investors in the South American country.

Argentina’s market deregulation efforts are expected to raise the energy investments in the country by about $2.5 billion to $15 billion in 2025, officials have said.

As a result, international companies are not shunning Argentina anymore and are exploring mergers and acquisitions (M&A) opportunities, including in the energy sector.

Still, the cost of supply and ability to compete on the global LNG market with prices would also be crucial to Argentina’s gas export potential.

Eni Signs MoU with YPF for Argentina LNG Project

by Rocky Teodoro|Rigzone Staff | Friday, April 18, 2025

Eni SpA has signed a memorandum of understanding (MoU) with Argentina’s state energy company YPF for the joint evaluation of the Argentina LNG project.

Argentina LNG is a large-scale upstream and midstream integrated gas development project, designed to develop the resources of the Vaca Muerta onshore gas field and serve international markets.

The project is expected to be developed in multiple phases and export up to 30 million tons per year (mtpa) of liquefied natural gas (LNG) by the end of the decade, Eni said in a news release.

The project phase covered by the MoU between the two companies covers the development of upstream, transportation, and gas liquefaction facilities through two floating LNG units of 6 mtpa each, for a total of 12 mtpa, according to the release.

Eni CEO Claudio Descalzi said, “YPF's choice of Eni as a strategic partner stems from the specific and distinctive know-how we have developed in FLNG projects in Congo and Mozambique, and from the recognition of our global leadership in implementing projects with this technology”.

YPF President and CEO Horacio Daniel Marín said, "We are very pleased to sign this agreement with Eni, which would allow us to accelerate the timeline for the Argentina LNG project. We see great interest worldwide, both from large production companies and from countries seeking to purchase gas from Vaca Muerta”.

Argentina approves Vaca Muerta gas pipeline expansion
Transportadora de Gas del Sur (TGS) plans to expand the pipeline capacity from Vaca Muerta to Buenos Aires province.

December 3, 2024

The Argentine Government has approved a $500m (506.15bn pesos) private sector initiative to enhance the gas pipeline system to connect with the Vaca Muerta shale region.

This move signals a substantial shift towards encouraging private investment in the country’s energy infrastructure, which has historically been state-led.

To boost domestic energy output and address its energy deficit, Argentina is actively seeking to attract more private investment, especially under the leadership of the new libertarian president Javier Milei.

The proposed expansion by TGS aims to increase the pipeline’s capacity from Vaca Muerta to Buenos Aires province. The government will oversee the tender for the project.

TGS, which presented its plan in June, has outlined a proposal to install six compressor tube sets across four plants, contingent on winning the tender.

If awarded the tender, TGS plans an additional $200m investment in a second phase to construct a 20km of pipeline and expand compression capacity within its concession area.

The energy secretariat said in a statement: “The initiative includes the expansion of the Perito Moreno gas pipeline between Tratayén (Neuquén) and Salliqueló (Buenos Aires) and work on four compressor plants.

“This will allow the company to add 14 million cubic metres of gas transportation capacity per day to the 21 million it already transports, so reaching 35 million cubic metres along the entire route.”

The expansion is part of Argentina’s broader strategy to boost production from the Vaca Muerta formation, considered to be the world’s second-largest shale gas reserve.

This includes building the necessary infrastructure to meet local demand and, in the future, to enable liquefied natural gas exports.

In a related development, Argentina’s state oil company, YPF, aims to secure $2bn in financing by the second quarter of 2025 for its Vaca Muerta Sur pipeline project.

The project aims to transport an additional 390,000 barrels per day from the Vaca Muerta formation to a coastal export terminal in Rio Negro province, Argentina. It is being undertaken by Vaca Muerta Oil Sur, a company controlled by YPF.

Vaca Muerta Shale Play in Argentina Hits New Oil Production Record

by Andreas Exarheas|Rigzone Staff | Tuesday, December 03, 2024

Argentina’s Vaca Muerta shale play reached a new oil production record of 400,000 barrels per day in the third quarter and is on track to hit one million barrels per day by 2030, according to Rystad Energy’s latest analysis.

That’s what Rystad stated in a release sent to Rigzone by the Rystad team recently, adding that the 35 percent year on year surge in third-quarter production was driven by improved productivity and expanded takeaway capacity, “led by flagship operator Yacimientos Petrolíferos Fiscales (YPF) and bolstered by local independent producers”.

Rystad highlighted in the release that YPF accounted for nearly 55 percent of Vaca Muerta’s oil production last quarter and pointed out that the company “saw its revenue rise seven percent quarter on quarter and 18 percent year on year to exceed $5.3 billion”.

“Independent producer Vista Energy also played a significant role, with its Bajada del Palo Oeste field contributing over 20 percent of the oil output growth, followed by YPF-operated Bandurria Sur and Loma Campana-Loma La Lata fields,” Rystad added.

The company noted in the release that this growth is also reflected in the increasing number of horizontal wells put on production. Rystad outlined that this averaged 40 wells per month in the third quarter. It stood at 33 in the first quarter and 34 in the second, the company highlighted.

“A record 46 new wells were brought online in September alone, of which 39 were in the oil zone and the remainder in the gas zone, underscoring the continued operational efficiency and momentum of Argentina’s flagship shale play,” Rystad said in the release.

The company stated that, to sustain this growth, Argentina is investing heavily in energy infrastructure to address bottlenecks.

“The $2.5 billion Vaca Muerta Sur pipeline, developed under the Large Investment Incentive Regime (RIGI), is a cornerstone of these efforts, aiming to expand takeaway capacity and facilitate smoother oil transportation from Vaca Muerta to global markets,” it said.

“In parallel, Argentina has significantly enhanced its transportation network, boosting domestic supply and export potential,” it added.

Radhika Bansal, Rystad Energy’s Vice President of Upstream Research, said in the release, “it can’t be overstated how crucial Vaca Muerta is to Argentina’s energy independence and efforts to reduce imports”.

“Alongside state-owned players, independent producers have a growing influence in the play, contributing 35 percent of oil production and 23 percent of gas production,” Bansal added.

“There is every reason to view Vaca Muerta as a central pillar of Argentina’s long-term energy strategy and economic resilience, with a real possibility of reaching the one million barrel per day mark by 2030,” Bansal went on to state.

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Argentina’s Second-Largest Shale Producer to Invest $1 Billion in Vaca Muerta

By Tsvetana Paraskova - Sep 04, 2024,

Independent producer Vista Energy, the second-biggest shale producer in Argentina, plans to invest around $1.1 billion in the growing shale basin Vaca Muerta, the company’s founder and CEO Miguel Galuccio told Reuters in an interview published on Wednesday.

The Vaca Muerta shale play in Argentina is the top development priority for the company, which also operates an onshore oil and gas field in Mexico.
Vaca Muerta—Spanish for ‘dead cow’—has been dubbed the Argentinian Permian, although its geologic properties have been compared more appropriately to the Eagle Ford.


The Vaca Muerta shale play is estimated to hold recoverable resources consisting of 16 billion barrels of oil and 308 trillion cubic feet of natural gas. Those numbers make the Vaca Muerta the world’s second-largest shale gas deposit.

Apart from investing $1 billion in the basin, Vista Energy also aims to achieve a double-digit drop in costs and boost efficiencies, Galuccio told Reuters.

“In 2012, Vaca Muerta was for believers. Today Vaca Muerta is for engineers,” the executive said, referring to the production gains operators can achieve from the shale play.

Vista Energy has up to 1,150 locations under development in Vaca Muerta, including 124 wells already drilled. Total production stood at 65,300 barrels of oil equivalent per day (boepd) in the second quarter of 2024, according to the company’s website.
Vista Energy, which is listed in New York and Mexico, also boasts that the productivity of its shale oil wells is among the best in the basin.

Argentina plans to raise oil and gas output and exports from Vaca Muerta in the coming years.

Supertankers could begin docking in Argentina to load oil from the country’s shale patch after a pipeline is set to connect Vaca Muerta with a terminal at Punta Colorada port capable of handling the so-called very large crude carriers (VLCCs).

Argentina is also moving a step closer to exporting LNG and monetizing its huge resource in the Vaca Muerta after maritime LNG infrastructure firm Golar LNG signed a 20-year deal with Pan American Energy (PAE) for the deployment of a Floating Liquefied Natural Gas (FLNG) vessel in Argentina.

Le bassin de schiste en Argentine va stimuler les exportations de pétrole grâce à des pétroliers géants.

OilPrice.comFrançais
By Tsvetana Paraskova - Jul 15, 2024



Des superpétroliers pourraient commencer à accoster en Argentine pour charger du pétrole provenant du gisement de schiste du pays après la mise en place d'un pipeline connectant le champ de schiste de Vaca Muerta à un terminal au port de Punta Colorada capable d'accueillir les pétroliers très grands transporteurs de brut (VLCC).

Début de cette année, la société énergétique d'État argentine YPF a entamé la construction de la première section d'un pipeline de 600 kilomètres conçu pour relier la production pétrolière de Vaca Muerta à la côte argentine, a rapporté Oil & Gas Journal en mai. La deuxième phase du projet de pipeline de 2,5 milliards de dollars comprendra le terminal d'exportation dans la région de Punta Colorada, qui aura la profondeur et la capacité nécessaires pour charger les superpétroliers, chacun étant capable de transporter jusqu'à 2 millions de barils de pétrole.
Étant donné que le terminal de chargement sera équipé de deux amarrages simples conçus pour accueillir les VLCC, l'Argentine devrait entrer sur le marché des superpétroliers cette décennie, a déclaré Gibson Shipbrokers dans son rapport hebdomadaire sur le marché des pétroliers.

L'Argentine augmente sa production de pétrole brut, et cette augmentation est largement passée inaperçue, mais le producteur sud-américain "n'est pas susceptible de rivaliser de la même manière que les grands exportateurs de brut ont fait suite à leur propre révolution du schiste", a déclaré Gibson.

Les expéditions de pétrole brut argentines se maintiennent régulièrement au-dessus de 100 000 barils par jour (b/j) depuis les deux dernières années et demie, principalement chargées sur des pétroliers Aframax, Panamax et Suezmax vers les États-Unis et le Brésil, selon Gibson.

Au cours des six derniers mois, les chargements sur Aframaxes ont augmenté, faisant passer la part des navires Aframax de seulement 4% en 2023 à près de 30% jusqu'à présent cette année, a déclaré le courtier maritime.

“D’autres changements sont probables, avec les VLCC gagnant des parts de marché une fois que le pipeline de Punta Colorada commencera ses opérations,” a noté Gibson.
L'Argentine se rapproche également du lancement de l'exportation de GNL et de la monétisation de ses énormes ressources dans Vaca Muerta après que la société d'infrastructures maritimes de GNL, Golar LNG, ait signé un accord de 20 ans avec Pan American Energy (PAE) pour le déploiement d'un navire de gaz naturel liquéfié flottant (FLNG) en Argentine.

YPF work on Vaca Muerta Sur project

July 19, 2024

Argentina's YPF is will begin second phase construction of the Vaca Muerta Sur project in November. The first section is already under construction.



YPF's president and chief executive officer recently noted progress toward the second phase of the Vaca Muerta Sur project, a pipeline between Neuquén basin and the Atlantic coast of the province of Río Negro.

The first section, already under construction, connects Loma Campana field in Vaca Muerta with the pumping station in Allen, Río Negro. The second section will extend from Allen to Chelforó and then to Punta Colorada.

Pampa Energía to begin developing Vaca Muerta shale oil

Camilo Ciruzzi Sept. 21, 2023

Argentine company Pampa Energía is set to invest $200 million to develop a pilot shale oil project in Vaca Muerta, the natural gas and electricity company’s first foray into the petroleum sector.


Argentine company Pampa Energía is set to invest $200 million to develop a pilot shale oil project in Vaca Muerta, the natural gas and electricity company’s first foray into the petroleum sector. The company acquired the entire Rincón de Aranda block in June 2023 through an asset swap with Total Energies SE.

Rincón de Aranda is part of the promising shale oil window of Vaca Muerta—near areas already under development such as Aguada Federal (Vista Energy SAB de CV) and Aguada del Chañar and La Amarga Chica (YPF SA)—and Pampa Energía plans to achieve a production plateau of 20,000 b/d.

The company will develop the 240-sq km block in phases, with Phase 1 expected to be completed in 2 years. Planning includes building two sets of four wells each, along with the necessary plants and infrastructure for processing and transportation.

Horacio Turri, executive director of exploration and production at Pampa, explained during the company’s second-quarter earnings presentation that it “will commence the pilot project in the first quarter of 2024, along with the required surface facilities." The company's chief executive officer, Gustavo Mariani, added, "In the medium term, our goal is also to become a significant player in the oil sector. With Rincón de Aranda, we are diversifying our exploration and production portfolio."

The block was jointly owned by Pampa Energía (55%) and Total Energies SE (45%). In June, the companies agreed to an asset exchange through which Pampa acquired the entire area while the French company's subsidiary received a wind farm.

L'Argentine inaugure le premier tronçon d'un gazoduc depuis le mégagisement de Vaca Muerta

AFP le 10 juill. 2023

Le gouvernement argentin a inauguré dimanche le premier tronçon du gazoduc Nestor Kirchner (GNK) construit depuis le mégagisement d'hydrocarbures non conventionnel de Vaca Muerta(sud-ouest) vers la province de Buenos Aires (centre), sur une distance de 573 kilomètres.

La construction du gazoduc Nestor Kirchner du nom de l'ancien président argentin (2003-2007), est le chantier d'infrastructure énergétique le plus important dans le pays depuis 40 ans.

L'inauguration a eu lieu à 15H00 (18H00 GMT) lors d'une cérémonie à l'usine de gaz Saturno dans la ville de Salliquelo, à 520 kilomètres au sud-ouest de Buenos Aires, créée pour acheminer le gaz de schiste depuis la ville de Tratayén, au coeur de Vaca Muerta, dans la province de Neuquen (sud).

Elle a été présidée par le président Alberto Fernandez, entouré de la vice-présidente Cristina Kirchner et du ministre de l'Economie, Sergio Massa.

"Face à ceux qui disent que ce pays est un pays d'échecs et de frustrations, nous montrons aujourd'hui que nous pouvons construire la souveraineté", a déclaré M. Massa, un libéral de centre-droit qui sera le principal candidat de la coalition au pouvoir à l'élection présidentielle du 22 octobre.

"Sa construction a coûté 2,5 milliards de dollars, sans financement extérieur. Nous économiserons 2 milliards de dollars d'importations cette année, pour atteindre 4,2 milliards de dollars en 2024", affirme la secrétaire d'Etat à l'énergie, Flavia Royon sur le site internet du gouvernement.

Le gisement de Vaca Muerta, qui s'étend sur 30.000 km2 en Patagonie, est considéré par le département américain à l'Energie comme la deuxième réserve mondiale de gaz de schiste, et la quatrième mondiale pour le pétrole de schiste.

Il est exploité par la compagnie pétrolière publique argentine YPF en partenariat avec le groupe américain Chevron.

Le deuxième tronçon du GNK, qui doit encore faire l'objet d'un appel d'offres, s'étendra sur 467 kilomètres jusqu'à la ville de San Jeronimo, dans la province de Santa Fe, à la frontière nord de la province de Buenos Aires.

"Lorsque tout sera terminé, nous serons autosuffisants en gaz et nous pourrons exporter un volume considérable vers le Chili, le Brésil et l'Uruguay", affirme Mme Royon.

La balance commerciale énergétique du pays en 2022 affichait un solde négatif de 6,6 milliards de dollars en raison des importations de diesel et de gaz naturel liquéfié (GNL).

"Notre balance énergétique aujourd'hui déficitaire parviendra à l'équilibre puis deviendra excédentaire", prévoit Mme Royon.

Un tiers du gaz est destiné à la consommation résidentielle, un autre tiers à l'industrie et le reste aux centrales électriques.

Outre YPF et Chevron, Shell, TotalEnergies et Statoil opèrent à Vaca Muerta.

L'Argentine inaugure le premier tronçon d'un gazoduc depuis le méga-gisement de Vaca Muerta

AFP VIDEO•10/07/2023
Le gouvernement argentin inaugure le premier tronçon du gazoduc Nestor Kirchner (GNK) construit depuis le méga-gisement d'hydrocarbures non conventionnel de Vaca Muerta (sud-ouest) vers la province de Buenos Aires (centre), sur une distance de 573 kilomètres. IMAGES

Argentina's Vaca Muerta Shale Play Could Produce 1 Million Bpd In 2030

By Rystad Energy - May 31, 2023,

> Crude oil production from Argentina’s burgeoning shale patch, Vaca Muerta, could surge in the coming years and top 1 million barrels per day by the end of the decade.

> Lack of takeaway capacity and rig availability could curb production growth.

> As of February 20223, Vaca Muerta’s gross oil production reached 291,000 bpd, an annual addition of 76,000 bpd.
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Oldelval unveils $750m plan to boost pipeline capacity from Vaca Muerta
The investment will be used to double the current pipeline capacity to 72,000 cubic metres per day, which will in turn help Argentina to increase oil exports to up to 250 thousand barrels per day

By NS Energy Staff Writer 19 Sep 2022

Oleoductos del Valle (Oldelval), which operates oil pipelines in Argentina, has unveiled plans to invest $750m in a bid to increase oil transport capacity from Vaca Muerta shale formation in Neuquén province.

The move was reported by Reuters citing Argentina’s Energy Ministry.

The investment will help in doubling the current capacity from 36,000m3 per day to 72,000m3 per day.

According to the energy ministry, the allocation will be used to lay around 525km of pipelines. The project will create around 1,200 jobs.

Overall, the task will be carried out in two phases with each expected to be completed in 11 months.

In the first phase, the capacity of the pipeline will be increased from the current 36,000m3 per day to 55,000m3 per day. The works under the second phase will further boost the capacity to 72,000m3.

The project will also increase Argentine oil exports to up to 250 thousand barrels per day, generating an income of around $4bn to $6.5bn.

The announcement came a week after the government approved a ten-year extension for Oldelval that will enable the company to operate pipelines from the Neuquen basin to Vaca Muerta until 2037.

Governor of Neuquén Omar Gutiérrez said: “We congratulate and appreciate the agreement reached by the Secretary of Energy and Odelval for the new concession. Certainties and assurances to be able to build the new track, a new parallel pipeline that will generate significant investment, production and work.”

Oldelval CEO Ricardo Hösel said: “With this milestone we are going to start the project, which will allow us to double the transportation capacity and will allow the country to generate foreign exchange of between 4 thousand and 6,500 million dollars.”

Could Argentina’s Dead Cow Shale Patch Help Solve The Energy Crisis?

By Matthew Smith - Jul 06, 2022

> Latin America’s third largest economy is reporting record-breaking hydrocarbon production.

> Shale oil and natural gas output from the Vaca Muerta basin have been vital in Argentina’s push to ramp up production.

> Some analysts are forecasting that Argentina will be pumping 1 million barrels of petroleum by 2026 seeing exports reach 500,000 barrels per day or more.

In a surprise development, Latin America’s third largest economy Argentina reported record hydrocarbon production for May 2022. For that month Argentina pumped an average of 574,465 barrels of crude oil and 136 million cubic meters of natural gas per day. Those volumes represent a 0.9% and 6.8% increase respectively over a month prior and a notable 13.9% and 6.9% higher year over year. The key driver of that impressive leap in production volumes was growing shale oil and natural gas output from the Vaca Muerta. Ministry of Economy data shows (Spanish) that Argentina pumped 241,024 barrels per day of unconventional oil for April 2022 which amounts to 42% of the country’s total petroleum production. That is 6% greater than a month earlier and an impressive 57% higher year over year. Unconventional natural gas production is also surging seeing Argentina pump 75 million cubic meters of unconventional natural gas during April 2022, which was 15% greater month over month and a whopping 38% higher than a year earlier. Those impressive numbers make Argentina Latin America’s largest natural gas and fifth largest oil producer after Brazil, Mexico, Colombia, and Venezuela.

This tremendous production growth can be attributed to the successful exploitation of the Vaca Muerta shale. The geological body, which covers 12,000 square miles, is a late Jurassic to early Cretaceous age formation located in the Neuquén Basin, which covers most of Neuquén Province. That sedimentary basin, where conventional oil production started in the early twentieth century, is at the core of Argentina’s hydrocarbon sector is responsible for 46% of the country’s oil output and 67% of the natural gas produced. The exploitation of the Vaca Muerta is vital to the recovery of Argentina’s long-running economic crisis which has seen the country default nine times on its sovereign debt since independence.

The geological formation is believed to be the world’s second largest shale gas and fourth largest shale oil resource. The US EIA estimated in 2013 that the Vaca Muerta contains recoverable hydrocarbon resources totaling 308 trillion cubic feet of natural gas and over 16 billion barrels of oil. Argentina’s national government in Buenos Aires believes the geological formation possesses even greater volumes of hydrocarbons. In 2018 the Secretariat of Energy announced that the Vaca Muerta contained unconventional resources totaling 27 billion barrels of oil and 802 trillion cubic feet of natural gas. Those numbers include the formation’s proven reserves of 2.1 billion barrels of oil and 11.9 trillion cubic feet of natural gas.

Those numbers point to the successful exploitation of the Vaca Muerta being a game changer not only for Argentina and its distressed economy but for South America where there is a growing focus on the need to enhance energy security. The exploitation of the Vaca Muerta also has the potential to ease the current global energy crisis where underinvestment by oil companies due to the 2015 oil price crash and pandemic along with the invasion of Ukraine has led to chronic energy shortages and soaring prices. Buenos Aires’ latest data indicates that the Vaca Muerta is finally delivering on the considerable promise shown by the formation over a decade ago when discovered by Spanish energy major Repsol.

Some analysts are forecasting that Argentina will be pumping 1 million barrels of petroleum by 2026 seeing exports reach 500,000 barrels per day or more. For that to occur there will need to be substantial production growth, of around 77% from current volumes, with Argentina only pumping an average of 565,143 barrels of crude oil per day for the first five months of 2022. Natural gas output over that period is expected to surge to as high as 260 million cubic meters per day, which will allow Buenos Aires to significantly ramp up exports, which according to S&P Global will see Argentina rival Australia and Qatar for LNG exports. If those events occur, it will improve Argentina’s precarious balance of trade and deliver a substantial economic windfall for Buenos Aires while ensuring the country’s energy security.

For that to occur, there must be significant ongoing investment in exploration and development drilling as well as related activities such as the development of crucial industry infrastructures like pipelines, and processing and storage facilities. Analysts estimated in 2018 that an investment of $120 billion in the Vaca Muerta between then and 2030 is required for the formation to be fully developed and realize its hydrocarbon potential. Elevated breakeven prices, estimated to be as high as $55 per barrel, in an operating environment weighed down by low oil prices deterred capital expenditures, but the recent oil price rally is acting as a powerful tailwind for investment. Soaring energy prices, with the international benchmark Brent gaining a whopping 37% since the start of 2022 to be selling for over $107 per barrel, are adding considerable momentum to the Vaca Muerta’s oil boom and foreign energy investment.

The attractiveness of investing in the Vaca Muerta is enhanced by the high-quality light sweet crude oil produced by the formation. The principal crude oil blend produced in Neuquén Medanito is a light and sweet grade, with API gravity of 42.5 degrees and very-low sulfur content of 0.2% which is low in contaminants. That makes Medanito cheaper and easier to process into high-quality low sulfur content fuels, seeing demand for the oil surging in European and U.S. refining markets. Some of the crude oil extracted from the Vaca Muerta is even lighter and sweeter making it an ideal diluent for blending with the heavier grades produced in southern Argentina. These characteristics mean that the petroleum produced in Neuquén has a low carbon footprint when extracted, refined and burnt, particularly in comparison to the heavier sour grades extracted in Venezuela, Colombia and Ecuador.

The characteristics of the oil produced in the Vaca Muerta augment the attractiveness of investing in the shale formation. This is particularly so in a world where decarbonizing the economy and reducing pollution are priorities, thereby making it critical for energy companies to reduce their carbon footprints. Buenos Aires’ focus on implementing measures to boost foreign hydrocarbon investment further bolsters the benefits that foreign oil and gas companies can obtain from investing in the Vaca Muerta. The latest measures include plans to ease capital controls for energy companies and the launching of tenders for the construction of a crucial multi-billion-dollar pipeline connecting the Vaca Muerta to crucial energy markets in the Buenos Aires province.

Argentina contracts Tenaris to complete gas pipeline from Vaca Muerta

By NS Energy Staff Writer 17 Jun 2022

Energia Argentina will buy 582km of 36-inch diameter pipelines and 74km of 30-inch pipelines, which will be used for the first stage of the gas pipeline project between Tratayén, in Neuquén, and Saliquelló, in the province of Buenos Aires

Argentina’s state-run Energia Argentina has reportedly signed a contract with pipeline manufacturer Tenaris to complete a pipeline that would supply natural gas from the Vaca Muerta shale formation.

The contract marks an important step towards the completion of the 563km gas pipeline project.

As part of the contract, the Argentinian company will purchase 582km of 36-inch diameter pipelines and 74km of 30-inch pipelines, reported Reuters.

The pipelines will be used for the first stage of the gas pipeline project between Tratayén, in Neuquén, and Saliquelló, in the province of Buenos Aires, along with other projects.

The first stage of construction may require 18 months and encompass a public investment of more than $1.5bn.

The project would help Argentina reduce costly liquefied natural gas (LNG) imports and reverse the energy deficit that hindered the country’s economic recovery.

Also, the gas pipeline is expected to provide a 25% boost in the gas volume transferred from the Vaca Muerta mega field, said the publication.

Vaca Muerta is a geologic formation of the Late Jurassic to Early Cretaceous age, located in the Neuquén Basin in northern Patagonia, Argentina.

The shale formation is said to be the world’s fourth-largest unconventional oil reserve and second-largest gas reserve.

Furthermore, the Argentinian court is currently reviewing the contract, which has been at the centre of an internal dispute within the ruling centre-left coalition, said Reuters.

Argentine: assouplissement du contrôle des changes pour l'industrie pétrolière

AFP•24/05/2022

Le gouvernement argentin a annoncé mardi un assouplissement du contrôle des changes pour l'industrie pétrolière et gazière afin de faciliter les investissements et augmenter la production

"Un régime spécial d'accès aux devises (de la Banque centrale) va être mis en place pour l'industrie des hydrocarbures pour garantir les équipements spécifiques que cela exige", a annoncé le ministre de l'Economie, Martin Guzman, lors d'un déplacement avec le président de centre gauche Alberto Fernandez.

L'Argentine possède en Patagonie le méga-gisement de Vaca Muerta, qui s'étend sur 30.000 kilomètres carré. Il est considéré comme la deuxième réserve mondiale de gaz de schiste et la quatrième mondiale pour le pétrole de schiste.

Mais son exploitation a été freinée par le haut niveau d'investissement nécessaire, en particulier pour la fracturation hydraulique.

Une vingtaine de compagnies pétrolières opèrent à Vaca Muerta depuis 2013, parmi lesquelles Chevron, Shell, Total et Statoil en partenariat avec la compagnie pétrolière argentine YPF.

Depuis septembre 2019, l'Argentine a instauré un contrôle des changes avec un taux d'accès officiel très limité, qui se situe actuellement autour de 120 pesos argentins pour un dollar. Parallèlement, il est toutefois possible d'acheter des devises étrangères par le biais d'obligations ou sur le marché informel à 200 pesos pour un dollar.

"Nous avons une grande opportunité en matière énergétique en Argentine. Les quinze prochaines années représentent un grand potentiel de développement", a souligné le président Fernandez, qui a récemment vanté son pays en Europe comme un "futur fournisseur stable d'énergie".

Le gouvernement table sur une augmentation de la production de pétrole de 70% et de gaz de 30% au cours des cinq prochaines années.

Ces derniers mois, l'Argentine a augmenté sa production d'hydrocarbures, avec un record de 578.000 barils/jour en avril, soit une hausse de 13 % sur les derniers douze mois, a déclaré le secrétaire à l'Energie Dario Martinez. Pour le gaz, la production s'est élevée à 127 millions de mètres cubes en avril, soit une hausse de 12%.

Le pays a ainsi réussi à inverser cinq années de baisse de la production pétrolière, selon le ministère de l'Economie.

Il y a quelques semaines, le gouvernement également a annoncé le lancement d'un appel d'offres pour la construction d'un gazoduc de Vaca Muerta vers le nord du pays, afin d'augmenter l'offre intérieure et l'exportation de gaz naturel de près de 40 millions de mètres cubes par jour.