Argentina increases gas exports to Brazil and Chile

Argentina is expanding its natural gas exports from Vaca Muerta to Brazil and Chile, bolstered by new transport infrastructure and increased production.

Share:

Comprehensive energy news coverage, updated nonstop

Annual subscription

8.25$/month*

*billed annually at 99$/year for the first year then 149,00$/year ​

Unlimited access • Archives included • Professional invoice

OTHER ACCESS OPTIONS

Monthly subscription

Unlimited access • Archives included

5.2$/month*
then 14.90$ per month thereafter

FREE ACCOUNT

3 articles offered per month

FREE

*Prices are excluding VAT, which may vary depending on your location or professional status

Since 2021: 35,000 articles • 150+ analyses per week

Argentina is striving to redefine its role in the South American energy market by increasing its natural gas exports from Vaca Muerta, one of the region’s largest shale reserves.
Faced with a significant drop in Bolivian gas exports to Brazil, Argentina sees a strategic opportunity to meet this growing demand by developing its infrastructure and increasing production.
The recent commissioning of new pipeline projects, such as the Néstor Kirchner, is central to this strategy.
The province of Neuquén, where Vaca Muerta is located, currently produces around 110 million cubic meters of gas per day, much of which is destined for the domestic market.
The country’s total gas production reached 150 million cubic meters per day in 2023, exceeding domestic consumption levels of around 140 million cubic meters per day.
The Argentine government and local companies are exploiting this production surplus to increase gas exports to neighboring markets, particularly Brazil and Chile, via existing and newly developed pipelines.

Infrastructure and Transport Capacities

One of the main levers for increasing exports lies in the expansion and modernization of transport infrastructures.
The recently commissioned Néstor Kirchner pipeline transports 22 million cubic meters of gas per day from Vaca Muerta to the province of Buenos Aires.
At the same time, a gas flow reversal project on another pipeline linking Buenos Aires to northern Argentina is due for completion in October, enabling new exports to Brazil via existing pipelines dating back to the 1990s.
These developments should enable Argentina to completely halt its gas imports from Bolivia and gradually increase its exports to Brazil and Chile.
In response to market changes, Pan American Energy and Tecpetrol, two of Vaca Muerta’s leading gas producers, plan to maximize the use of these new transport capacities to expand their presence in regional markets.

Vaca Muerta Production Potential

Vaca Muerta represents considerable potential for Argentina.
With around 300 trillion cubic feet of recoverable resources, this shale formation is one of the largest in the world and provides Argentina with a solid base for increasing its natural gas exports.
By 2023, around 90% of Neuquén province’s gas production will come from Vaca Muerta and a few other tight gas formations.
Estimates from the province of Neuquén suggest that production could reach 180 million cubic meters per day by 2030 and 270 million by 2031, thanks to projects such as the LNG export terminal, which could reach a capacity of 120 million cubic meters per day.
These forecasts are based not only on the continued increase in shale production, but also on the optimization of existing and future infrastructure capacities.

Repositioning in the Regional Market

The decline in Bolivian gas exports, from 25 million to 14 million cubic meters per day in recent years, creates an immediate opportunity for Argentina.
With an additional export capacity of 5 million cubic meters per day in the short term, Argentine companies are looking to capture a share of the Brazilian energy market, traditionally dominated by Bolivia.
For Chile, which historically imported gas from Argentina until exports were reduced to zero in the 2010s, prospects are also improving.
By 2023, gas exports to the region have recovered to around 4 million cubic meters per day, a figure that is set to rise as new pipeline projects come on stream.

Future prospects and challenges

Argentina will have to navigate several challenges to achieve its export growth targets.
Volatile global gas markets, infrastructure constraints and competition with other regional and global producers will pose obstacles.
However, by strengthening its transportation capacities and increasing its shale gas production, Argentina is positioning itself to become a key supplier of natural gas to the regional market.
Future decisions on infrastructure investment and long-term trade agreements with neighboring countries will be crucial.
These agreements could not only stabilize Argentina’s revenue stream, but also strengthen its position as a key player in South America’s energy sector.

Pembina Pipeline Corporation has completed a $225mn subordinated note offering to fund the redemption of its Series 9 preferred shares, marking a new step in its capital management strategy.
A jihadist attack targeted Palma, a strategic area in northern Mozambique, marking a return of insecurity near TotalEnergies' suspended gas project since 2021.
Fermi America has signed an agreement with Energy Transfer to secure a firm natural gas supply for powering Phase One of its HyperGrid energy campus, dedicated to artificial intelligence, near Amarillo, Texas.
Rockpoint Gas Storage priced its initial public offering at C$22 per share, raising C$704mn ($515mn) through the sale of 32 million shares, with an over-allotment option expanding the transaction to 36.8 million shares.
Tailwater Capital secures $600mn in debt and $500mn in equity to recapitalise Producers Midstream II and support infrastructure development in the southern United States.
An economic study reveals that Germany’s gas storage levels could prevent up to €25 billion in economic losses during a winter supply shock.
New Fortress Energy has initiated the initial ignition of its 624 MW CELBA 2 power plant in Brazil, starting the commissioning phase ahead of commercial operations expected later this year.
Talen Energy launches $1.2bn debt financing and expands credit facilities to support strategic acquisitions of two combined-cycle natural gas power plants.
The Ukrainian government is preparing to raise natural gas imports by 30% to offset damage to its energy infrastructure and ensure supply continuity during the winter season.
Driven by rising electricity demand and grid flexibility needs, natural gas power generation is expected to grow at an annual rate of 4.8% through 2030.
Talen Energy secures $1.2bn term financing and increases two credit facilities to support the acquisition of two natural gas power plants with a combined capacity of 2,881 MW.
Tenaz Energy finalised the purchase of stakes in the GEMS project between Dutch and German waters, aiming to boost production to 7,000 boe/d by 2026.
Sembcorp Salalah Power & Water Company has obtained a new 10-year Power and Water Purchase Agreement from Nama Power and Water Procurement Company, ensuring operational continuity until 2037.
Eni North Africa restarts drilling operations on well C1-16/4 off the Libyan coast, suspended since 2020, aiming to complete exploration near the Bahr Es Salam gas field.
GOIL is investing $50mn to expand its LPG storage capacity in response to sustained demand growth and to improve national supply security.
QatarEnergy continues its international expansion by acquiring 27% of the offshore North Cleopatra block from Shell, amid Egypt’s strategic push to revive gas exploration in the Eastern Mediterranean.
Polish authorities have 40 days to decide on the extradition of a Ukrainian accused of participating in the 2022 sabotage of the Nord Stream pipelines in the Baltic Sea.
The Japanese company has completed the first phase of a tender for five annual cargoes of liquefied natural gas over seven years starting in April 2027, amid a gradual contractual renewal process.
Baker Hughes has secured a contract from Bechtel to provide gas turbines and compressors for the second phase of Sempra Infrastructure’s LNG export project in Texas.
Targa Resources will build a 500,000 barrels-per-day pipeline in the Permian Basin to connect its assets to Mont Belvieu, strengthening its logistics network with commissioning scheduled for the third quarter of 2027.

All the latest energy news, all the time

Annual subscription

8.25$/month*

*billed annually at 99$/year for the first year then 149,00$/year ​

Unlimited access - Archives included - Pro invoice

Monthly subscription

Unlimited access • Archives included

5.2$/month*
then 14.90$ per month thereafter

*Prices shown are exclusive of VAT, which may vary according to your location or professional status.

Since 2021: 30,000 articles - +150 analyses/week.