Argentina Approves Construction of Key Vaca Muerta Gas Pipeline

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)-- This week, the government of Argentina's President Javier Milei approved a tender for private investments of US$500 million for the expansion of the Perito Moreno gas pipeline (formerly known as the Nestor Kirchner Gas Pipeline), which transports natural gas from Vaca Muerta to the Buenos Aires province.

The project has been proposed as a private investment initiative by Transportadora de Gas del Sur (TGS) (Buenos Aires, Argentina).

Milei's administration had vowed to end public spending on new infrastructure amid strict government cuts. However, the tender for this pipeline expansion demonstrates the government's priority to boost energy developments, especially in Vaca Muerta, the world's second-largest shale gas reservoir.

The development of this asset will be the Milei government's first public tender carried out by a private company. The expansion of the Perito Moreno will be part of Argentina's RIGI system, a program for investments above US$200 million which grants fiscal and legal incentives for 30 years to companies that invest in the country.

The project includes capacity expansion of the Tratayen (Neuquen province) -- Salliquelo (Buenos Aires province) pipeline section of the 573-kilometer (356-mile) pipeline and work on four compression stations. These expansions will allow for an extra capacity of 14 million cubic meters per day to reach a total capacity of 35 million cubic meters per day.

The government expects to save US$567 million in natural gas imports with these expansions.

The Perito Moreno gas projects ultimately aim to transport natural gas from the remote Vaca Muerta to the northern provinces of Argentina, which traditionally import natural gas from Bolivia.

However, Vaca Muerta production expansions in recent years have ushered in more midstream investments to boost the transport of the reservoir's output.

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