Snapshot: Argentina’s 7 biggest gas producers

Drillers in Argentina’s Neuquén province produced around 91.4Mm3/d (million cubic meters per day) of gas in July, up from roughly 91Mm3 in June, according to data published by the jurisdiction’s energy ministry.

Shale accounted for 71%, tight 15% and conventionals 14% of output.

National production in July was 138Mm3/d, according to data from the General Mosconi institute energy think tank, based on statistics from the federal energy department.

Neuquén sits over the biggest chunk of the Vaca Muerta unconventional hydrocarbons formation, which has been driving national output growth, offsetting a decline in output from conventional fields.

The provincial government said that in August production climbed 6.98% month-on-month to a record 97.8Mm3/d. Nationally, production rose to 144Mm3/d.

Neuquén output growth was driven by Pampa Energía’s El Mangrullo and Sierra Chata, Tecpetrol’s Fortín de Piedra and Pan American Energy’s Aguada Pichana Oeste licenses.

The province has 47 unconventional extraction projects corresponding to a total of 9,981km2, or around 33% of Vaca Muerta surface area. 

Neuquén could, based on greater acreage development, produce 150Mm3/d gas in 2027-28, governor Omar Gutiérrez indicated. The country, meanwhile, could potentially produce 226Mm3/d in 2030, with shale gas accounting for 75%, according to a report commissioned by local hydrocarbons production and exploration chamber CEPH. Achieving this would involve ramping up investment and implementing regulatory measures to help incentivize requisite E&P and midstream infrastructure outlay. 

Investment in conventionals and unconventionals would need to hover around US$2.55bn/y through 2028 before climbing to US$4.17bn in 2029 and US$6.13bn in 2030, the report states. Associated investment was US$1.83bn last year and is projected to register at US$2.17bn this year.

Sector players have been calling for tweaks to support competitiveness and for long-term regulatory stability. Along with easing forex controls, another demand is for a long-term state energy policy that remains in place no matter which political coalition is in power.

While Argentina’s political parties differ on many issues, development of the oil and gas industry generally receives bipartisan support. As things stand, a right-wing or center-right government appears likely to take the helm following elections next quarter. The big question is what policy is presented and whether it gets through congress.

A junior and a major have announced plans to sell assets in the country.

ARGENTINA’S SEVEN BIGGEST GAS OPERATORS

July production of 138Mm3/d was flat month-on-month and down 1.5% year-on-year, according to General Mosconi and the federal energy department. Warmer than usual winter temperatures have slacked demand.

No.1 YPF
 35.4Mm3/d, down 6% year-on-year

No. 2 Total Austral
 30Mm3/d, down 2.5% a year-on-year

No. 3 Tecpetrol
 20.2Mm3/d, down 2.9% year-on-year

No. 4 Pan American Energy
 19.2Mm3/d, up 8.7% year-on-year 

No. 5 Pampa Energía
 10.7Mm3/d, up 2.3% year-on-year

No. 6 Pluspetrol
 7.1Mm3/d, up 3.8% year-on-year

No. 7 CGC
 5.9Mm3/d, up 42.1% year-on-year

VACA MUERTA

The biggest players in Vaca Muerta, which produced 65.3Mm3/d in July according to General Mosconi-federal energy department data, were Tecpetrol (18Mm3/d), YPF (16.1Mm3/d), Pan American Energy (9.2Mm3/d), Total Austral (8.9Mm3/d), Pluspetrol (4.8Mm3/d) and ExxonMobil (0.5Mm3/d). YPF, Tecpetrol and Exxon reported drops of 2.3%, 2.5% and 39%, respectively. 

In related news, the first phase of the key Vaca Muerta gas pipeline, brought online this half to help substitute imports and lay the foundation for increased exports, has already resulted in energy import savings of US$421mn, state energy company Energía Argentina said. Injections into the duct, estimated to have cost around US$1.9bn, are substituting around US$12mn in energy imports a day, it said.

Once compression plant work on the first phase is completed next year, capacity is due to climb to 30Mm3/d from around 11Mm3/d.  

A second phase with a US$3.2bn price tag is planned. A key hurdle is securing the financing.