Argentina will begin to ship natural gas to Chile by the end of 2018 and first gas could be supplied in October or November 2018. The supplies are expected to come from Argentina's Austral basin and from the Neuquén basin, where the Vaca Muerta shale formation is located. Argentinian gas is likely to be used for power generation purposes or to sustain the rising demand from the residential heating sector especially in areas still relying on wood for their heating requirements.
Argentina used to be a major supplier of gas to Chile but the cross-border trade interrupted in the mid-2000s, when declining production prompted Argentina to cut off exports. Since then, both countries have signed trade agreements allowing for the export of gas or electricity in emergency situations, but those agreements required that an equivalent amount be re-imported within 12 months. The increasing production from the Vaca Muerta basin is expected to enable Argentina to export more gas than it imports by 2021.