Argentina to Start Exporting LNG from Vaca Muerta in 2027 with New Agreement

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Golar LNG (NASDAQ:GLNG) (Hamilton, Bermuda) and Pan American Energy (PAE) (Calgary, Alberta) have signed a 20-year agreement to deploy a floating liquefied natural gas (FLNG) vessel for exports from Argentina. They expect to export LNG by 2027 and unlock Vaca Muerta's vast shale gas resources.

Vaca Muerta is the world's second-largest shale reservoir and the fourth non-conventional oil reserve. Argentina has been able to ramp up its shale gas and oil production, which accounts for 43.6% of the gas and 47.5% of the oil produced in the country in 2023.

The agreement between Golar and PAE will utilize Golar's Hilli FLNG, which has a capacity of 2.45 million tons of natural gas per annum (mtpa), with a net tariff of US$2.6 per million British thermal units at 90% utilization capacity.

As part of the partnership, Golar will hold a 10% interest in Southern Energy S.A, a joint venture with PAE, which will be in charge of purchasing natural gas as well as operations and sales of LNG from Argentina, according to the company statement.

Golar Chief Executive Officer Karl Fredrik Staubo said, "We are excited to enter a partnership with Pan American Energy, one of the leading energy companies in Latin America. The project will provide an international outlet for Argentina's vast and attractive natural gas reserves, creating value to Argentina and its gas stakeholders. The project expands Golar's global footprint, with further growth potential."

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Expanding midstream and export capacity in Vaca Muerta will be key to further developing the shale reservoir. In addition to the FLNG facility, other natural gas midstream assets have recently been built, such as the new Nestor Kirchner Pipeline inaugurated last year, to transport natural gas from Vaca Muerta to the center and northern parts of the country.

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