The Malaysian state-owned oil and gas company Petronas and its Argentinian counterpart Yacimientos Petrolíferos Fiscales (YPF) have signed preliminary agreements to build a LNG facility and a gas transport pipeline at the Vaca Muerta shale gas formation, in central Argentina.
The project, estimated at US$10bn, is expected to have a LNG output of 5 Mt/year in the first year of operation and is anticipated to take 10 years to complete. Once fully operational, the project will have a peak LNG production and export capacity of 25 Mt/year and will include a 600 km pipeline out of the Vaca Muerta shale play.
Vaca Muerta has estimated gas reserves at around 8,700 bcm and oil reserves at 16.2 Gbl. It is estimated to be the second largest unconventional gas reserve and the fourth largest oil reserve of its kind in the world, with only 7% of its potential developed.
Argentina's oil production declined by 5% in 2020 to 29 Mt, after a 4% rise in 2019. Natural gas production dropped by 9% in 2020 (41 bcm), after having increased by 3.4%/year over 2014-2019. Conventional gas and oil reserves amount to around 400 bcm and 340 Mt, respectively (end of 2020).
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