Agencies
Argentina’s state-run oil company YPF, in collaboration with Shell, has signed a project development agreement to advance the development of the Argentina LNG project.
Touted as the nation’s premier LNG project, the multi-stage $50bn Argentina LNG initiative focuses on the liquefaction of gas for international export.
It involves extracting gas from specific blocks in Vaca Muerta and transporting it via dedicated pipelines. These pipelines will stretch 580km to a processing and liquefaction facility that is set to be constructed in Sierra Grande, Rio Negro, along the Atlantic coast.
The partnership, formalised in the Netherlands, marks Shell’s involvement in the initial phase of the project, targeting annual production of ten million tonnes per annum of LNG.
The two companies will collaborate to move the project to the front-end engineering design stage.
YPF president Horacio Marin said: "We are proud that Shell, a world leader in LNG production, is joining the project. As a pioneer in the LNG market, Shell’s knowledge and experience will be instrumental in helping to position Argentina as a reliable and competitive global energy supplier.”
The recent agreement indicates the conclusion of Malaysian state oil company Petronas’ involvement in the Argentina LNG project.
However, Petronas will maintain its collaborative efforts with YPF in developing the La Amarga Chica area within Vaca Muerta, recognised as the world’s second-largest unconventional gas reserve and fourth-largest oil reserve.
Shell said in a separate statement that the LNG project "is aligned with Shell’s plans to continue growing its LNG business”.
YPF also recently sanctioned the construction of a new oil pipeline in partnership with Pan American Energy, Vista Energy and Pampa Energía to support exports from the Vaca Muerta Sur region.
The $3bn Vaca Muerta Sur pipeline will include a loading/unloading terminal, monobuoys and storage facilities, is due to commence operations in the fourth quarter of 2026.
It will initially handle 550,000 barrels per day (bpd), with the potential to scale up to 700,000bpd.