Pampa Energía partners with PAE and supplies Vaca Muerta gas for export by ship

Pampa Energy the oil and electricity generator of Marcelo Mindlin and its partners, will join with a 20% share to society Southern Energy created by Pan American Energy (PAE) -from the Bulgheroni family, BP and Chinese partners- and the Norwegian Golar LNG for the project exports of Liquefied Natural Gas (LNG) from Argentina to the world.

This initiative, which will be part of the “Argentina LNG” and will integrate the entire industry, may also include YPF in the coming months. The president and CEO of the oil company, Horacio Marinis negotiating with Marcos BulgheroniGroup CEO of PAE, to be another local partner and reinforce gas export capabilities, according to what they both said in Linkedin.

Last week PAE appeared before the Government to request the entry of this project into the Large Investment Incentive Regime (RIGI)in order to have benefits in terms of taxes, imports and access to dollars.

The Bulgheroni family firm anticipates that it will begin exporting liquefied gas from 2027 on a seasonal basis during the summer months, with a initial investment of US$ 1,650 million until 2031. The intention is that the entire oil industry becomes associated and that gas can also be sold to the world every day of the year.

The main interested party in buying the fuel is Brazil and further behind are countries from the European Union, India and China.. If all the country’s capacities could be developed with exports of 120 million m3 per day (MMm3/d) of natural gas -2 liquefaction barges of 20 MMm3/d and a plant of 80 MMm3/d-, it would represent sales of about $15 billion a year from 2031.

There are those who still raise serious doubts about the country’s capacity to build an LNG plant, which would cost between 30,000 and 50,000 million dollars counting the investment in wells, gas pipelines and equipment for liquefaction (cooling the gas to 161 degrees below zero to compress 600 times its volume and facilitate its transportation), taking into account the associated risks and the push that Donald Trump will give to the United States as the main world supplier.

Now Pampa Energía has committed to supply 22.2% of the natural gas volumes from its fields in the Neuquén Basin, where the unconventional formation is located. Dead Cow.

Gustavo MarianiCEO and vice president of Pampa Energía, highlighted: “We decided to join because we consider it to be a very important project. so that the country becomes a world exporter of liquefied natural gas”.

“This will help consolidate macroeconomic stability, transforming the immeasurable reserves that we have underground into currencies that will magnify the policy of trade surplus” he added.

Rodolfo Freyrevice president of Gas, Energy and Business Development of PAE, said that “Vaca Muerta’s unconventional natural gas is competitive with the best resources worldwide and needs to develop new markets to consolidate its growth.

“LNG will open the door to the world for us and with Southern Energy we seek to be a reliable supplier for the global market. This project, to which Pampa Energía is joining today, is the first step of a path that will be developed in stages and that must involve to the entire industry,” he added.

The project led by PAE will allow exports 11.5 million m3 per day of natural gas (MMm3/d) from 2027with investments of 2.9 billion dollars in the next 10 years (2025-2034).

Throughout its useful life – about 20 years – it is expected that disbursements will reach almost US$ 7,000 million, so there will be great growth between 2035 and 2044.

The project will allow the installation and operation of Golar’s “Hilli Episeyo” liquefaction vessel, contracted by Southern Energy, in the San Matías Gulf, in the province of Río Negro.

The ship has a production capacity of 2.45 million tons of LNG per year, equivalent to 11.5 MMm3/d day of natural gas.

This project, which recently requested entry into the RIGI, will allow Argentina to position itself in the global LNG market, where the country does not yet have participation.

In addition, it will favor the creation of some 600 jobs during construction and 850 jobs in operation, together with the development of the entire natural gas value chain with a high participation of local suppliers, who will provide more than 50% of the goods and services.

Pampa currently produces an average of 14.5 MMm3/d of natural gas per day in its Sierra Chata and El Mangrullo fields in Vaca Muerta, with peaks of 17 million m3 per day in winter.