Argentina's state oil company YPF and its Malaysian counterpart, Petronas, inked a deal on Thursday to build a major liquefied natural gas (LNG) plant and a pipeline to transport the fuel, as demand for the fossil fuel spikes globally, said Reuters.
An agreement could be announced as soon as the end of the week, likely ahead of the Gastech conference in Milan that begins on 5 September. Confirmation from YPF and PETRONAS could not be reached before publication.
YPF operated a brief run at LNG exports between 2019 and 2020, with its Tango FLNG project that was installed in Bahia Blanca. The project’s operations were short-lived, however. Six LNG cargoes were exported, before payments were terminated and Exmar took back the vessel.
Tango FLNG has since been acquired by Italy’s Eni for its exports in the Republic of Congo. Eni’s project could start production as soon as the second half of 2023. Sources said that YPF could consider a bridging venture using floating LNG again while pursuing an onshore liquefaction project, which could be planned as a sizeable project.
One source said as much as 25mtpa was under consideration, but that this sounded overambitious. Argentina has been a net importer of LNG, particularly during the country’s southern hemisphere winter.
YPF would look to export during the country’s summer season, which runs during the northern hemisphere winters in Europe and Asia, coinciding with peak LNG demand. Argentina has imported about 1.8m tonnes of LNG from January to August 2022, according to ICIS LNG Edge. Argentina imported 2.1mtpa in 2021.
We remind, YPF said it would maintain its USD2.7 billion 2021 investment plan despite only partially resolving a recent debt crisis, with USD1.3 billion of the spending for shale oil and gas production at Vaca Muerta, reported Reuters.
The investment represents an 73% increase versus 2020, when the firm suffered a severe blow from the drop in international oil prices and lower demand due to the coronavirus pandemic.
As MRC informed earlier, Argentina's state-backed energy company YPF plans to ramp up it investment 73% this year, with the brunt of the increased spending going toward rebuilding oil and natural gas production after a 10% slump in 2020, according to a company source's statement Jan. 26, 2021.
mrchub.com