Argentina LNG export project gathers backing from shale drillers

A plan to export liquefied natural gas from Argentina is gaining momentum, with four drillers in the country’s heralded shale patch now signed on to supply a facility with the fuel.

London-based oil company Harbour Energy Plc announced this week that it would acquire a 15 percent equity stake in the roughly US$3 billion floating liquefaction project, or FLNG, spearheaded by driller Pan American Energy Group and FLNG vessel provider Golar LNG Ltd.

Harbour recently acquired drilling assets in Argentina from Germany’s Wintershall Dea AG that include areas in the Vaca Muerta shale formation. Wintershall’s offshore venture with Pan American — which is 50 percent owned by BP Plc — and France’s TotalEnergies SE were also part of the acquisition.

Harbour follows Pampa Energia SA, which said on November 29 that it will have a 20 percent stake in the project, and Argentina’s top oil and gas producer state-run YPF SA, which also intends to pipe fuel to the FLNG. The facility is scheduled to start operations on the Atlantic coast in 2027.

YPF has been developing a liquefied natural gas project of its own involving multiple FLNGs and, eventually, construction of an onshore plant. Even with various projects being analyzed, YPF’s chief executive has said that Argentina’s drillers should rally around one venture.

Argentina’s LNG ambitions put it in competition with growth in the US and Qatar, two of the world’s top natural gas suppliers. Demand for the fuel has been on the rise in Europe, where importers are cutting back on gas piped from Russia, and in Southeast Asia, where new buyers are de-carbonising their energy portfolios.