LNG

Argentina’s state-controlled YPF, together with partners Eni and XRG, has submitted an application to enrol the Argentina LNG project in the country’s Large Investment Incentive Regime (RIGI). The $51 billion project will export liquefied natural gas from the Vaca Muerta shale formation, with operations targeted to begin in 2031.

Italy’s energy major Eni has agreed to acquire a 32% interest in three upstream blocks in the Vaca Muerta basin, designated as feedstock for an Argentine LNG export project. Argentina’s state oil company YPF, together with Eni and the Abu Dhabi-based investment firm XRG are working intensively to reach FID on the 12 mtpa Argentina LNG project during the second half of 2026.

Argentina’s Vaca Muerta shale is drawing investor interest to a 15-block licensing round for blocks suited for LNG feedgas development. The bidding round comes as LNG buyers reassess their portfolio exposure to supplies chains build around the Strait of Hormuz. Disruption or perceived risk to future LNG exports from Qatar and the UAE have increased interest in Atlantic Basin alternatives.

Substantial upstream investment in Vaca Muerte shale is meant to help Argentina evolve from seasonal floating liquefaction to a multi-phase LNG exporter. To that end, state-controlled YPF plans to channel $3.3 billion into Vaca Muerta shale, with recent FIDs on two FLNG units in the Gulf of San Matías and associated infrastructure.

XRG, the overseas business unit of Abu Dhabi National Oil Company (ADNOC) is in talks to invest in an LNG export project that Argentina’s YPF is developing. The proposed LNG development, based on gas from the Vaca Muerta shale, seeks to establish Argentina as a regional exporter by the late 2020s.

Argentina’s state oil and gas company YPF and the Italian energy giant Eni have signed the final technical project description (FTPD) for a 12 mtpa phase of the integrated Argentina LNG project – the final step before financial close. The floating LNG terminal is designated to export gas from the vast Vaca Muerta shale.

Argentine oil and gas incumbent YPF is about to take FID on developing the Vaca Muerta basin, supported by new legislation. “The new law allows LNG to be exported from gas produced in Vaca Muerte without having to pay tax,” CEO Horacio Marín said at Gastech today.

Argentina's Vaca Muerta shale play has achieved significant first-quarter gains, with oil output rising 26% and gas production up 16% yoy, underpinning the Southern Energy LNG project. Financial close on MK II – one of two FLNG vessels supplied by Golar – is slated for Q3-2025.

The governments of Argentina and Bolivia confirmed a new pipeline natural gas agreement with the Argentinians saying they would save foreign exchange reserves with the Bolivian gas and would have to buy 14 fewer LNG cargoes to meet their needs.

Argentine President Alberto Fernandez and his Bolivian counterpart Luis Arce reached a deal in talks in Buenos Aires for Bolivia to export 14 million cubic metres of natural gas per day to Argentina during the Southern Hemisphere winter season.

A joint statement said that the price of the Bolivian supplies was set at US$12.18 per million British thermal units.

Argentina’s Energy Secretary, Dario Martínez, said the Bolivian provisions would mean about 14 fewer cargoes of LNG would have to be purchased at high price and would save Argentina around US$770 million in LNG import costs.

“This is good news for Argentina, for the Central Bank’s dollar reserves and for the government’s fiscal plan,” said Martínez in a statement.

Analysts note that Argentina has suffered from an ailing economy and has been unable to meet investment needs to monetize its huge shale oil and gas resources.

A Bolivian Government statement later said the provision of gas in 2021 from Bolivia to Argentina was established at 14 million cubic metres er day, in winter, and for the rest of the year at 10 million cubic metres and this would be repeated.

Possible increase

“The President of Bolivia Luis Arce agreed with his Argentine counterpart, Alberto Fernández, the sale of natural gas and promised to give priority to its neighbour in case there is a greater production of natural gas on the Bolivian side,” added the statement.

“We are making an effort to maintain the levels of past gas supply to the Republic of Argentina and with additional gas that may be produced in Bolivia,” declared the Bolivian President.

Bolivia added that specific mechanisms between the Bolivian and Argentine state energy companies, Yacimientos Petrolíferos Fiscales Bolivianos and Argentina’s IEASA (Integración Energética Sociedad Anónima) would benefit both countries.

“The Argentine and Bolivian presidents agreed on the importance of realising concurrent actions so that the contract of Purchase and Sale of Natural Gas between YPFB and IEASA, reflects a new régime,” added Bolivia.

“It guarantees the supply of 14 million cubic metres, giving priority to making available additional volumes in the winter period as well as waiving the rights and obligations through to 2025, whose effect will be entrusted to the responsible Ministries and departments in order to draft the corresponding documents,” it added.

“The Presidents further agreed to advance in the study of investment opportunities for YPFB in the Vaca Muerta Shale basin in Argentina, working jointly to identify the alternatives for supplying liquid fuels in order to secure the energy security of both states,” stated Bolivia.

Argentine oil and gas producer, Yacimientos Petroleiferos Fiscales (YPF), said a natural gas well caught fire at its huge onshore Vaca Muerta shale gas and oil basin in the northwest of the country and whose resources are expected to lead to future large-scale LNG exports.