The Argentinian state-owned oil and gas company YPF has started the development of the second section of its Vaca Muerta South oil pipeline in Argentina. The section consists of a 440 km pipeline connecting the town of Allen to the port of Punto Colorada, both located in the Rio Negro province, and construction will start in late December 2024 or early January 2025. The section is expected to be completed within 22 months, and the pipeline plans to start export operations in the second half of 2026 with an initial capacity of about 390 kb/d. It will help increase the evacuation capacity from the Neuquén Basin by up to 700 kb/d by 2028.
The US$2.5bn Vaca Muerto Sur pipeline project is currently developing its first phase (Loma Campana-Allen) having about 50% complete of the 130 km section with an estimated US$200m investment. YPF plans to create a private company (VMOS) to operate the new pipeline, expecting to attract the participation of international operators to finance 70% of the total investment for the project (about US$1.8bn).
The Vaca Muerta formation 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.
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