Argentina is a major producer of natural gas and, in recent years, the country has increased its natural gas production, largely thanks to the exploitation of its vast resources, including shale gas and tight gas. And in December, Argentina secured financing for the second leg of the Néstor Kirchner natural gas pipeline system, as confirmed by energy secretary Flavia Royon.
The financing figures
In detail, Argentina has secured a loan of 689 million dollars from the Brazilian National Development Bank and an additional $540 million from the Latin American development bank Corporacion Andina de Fomento.
The evolution of the project
According to government officials, the first phase of the pipeline, valued at $1.5 billion, is expected to be active from June 2023. The infrastructure is set to have a capacity of 24 million cubic meters per day and will extend form the city of Tratayén, in the province of Neuquén, to Salliqueló, in the province of Buenos Aires, including the provinces of Rio Negro and La Pampa.
The second phase of the project involves the modernization of the Gasoducto Norte pipeline system, including flow reversal operations and compression stations in the northern part of the country. This solution would ensure greater energy independence for Argentina, with a clear reduction in imports from Bolivia. A trend already evident from the Vaca Muerta shale deposit: unconventional gas production scored a record result in August, representing 56% of the total.
A sumptuous growth
Argentina’s Economy Ministry recorded, in the third quarter, an increase in natural gas production of 5.2% year/year.
For state oil firm YPF SA, unconventional oil production rose 50% year/year in the third quarter, while unconventional natural gas output was up 20%.
This growth was boosted by operational improvements at Vaca Muerta, where the company reached new hydraulic fracturing and drilling rates. Spurred by Vaca Muerta, jobs in the oil and gas sector have grown for 13 consecutive months to about 100,000.
The development of natural gas infrastructure and, consequently, the increase in production could lead to LNG exports, inverting the nation’s energy balance.