Argentina and Mexico both exhibit promising shale gas potential. Although Argentina is characterized as an emerging shale gas industry, Mexico's progress is relatively insignificant to date.

Both countries are natural gas net importers and actively seek to grow their domestic markets. In Argentina, shale gas could also be key to turning around a sputtering economy.

Argentina primarily relies on natural gas for electricity generation and industrial uses. Currently, the country has almost 29,000km of pipelines. On the other hand, Mexico produces most of its electricity from petroleum-based liquids and has just over 12,000km of natural gas pipelines.

Argentina and Mexico continue to increase natural gas demand. The majority of current imports come from Bolivia (Argentina) and the US (Mexico). Argentina also continues to increase its use of imported LNG. Mexico is increasing its natural gas distribution capacity by pushing a myriad of pipeline projects in the coming years.

Even though Argentina holds second place in global shale gas reserves, boasting 802 trillion cubic feet (tcf) of recoverable shale gas, and Mexico stands firm at sixth place, with 545tcf, a set of conditions is still required in both countries for natural gas investment to prosper. In the case of Argentina, market-driven gas pricing is at the top of the requirement list.

Paired to this, a strong local supply chain and highly-skilled human resources are essential for shale gas to bloom in both countries.

A sizeable proportion of technically recoverable gas resources in both countries is in the form of shale, meaning shale gas will play an important role in future supply. In the case of Argentina, recoverable shale gas is 67 times greater than conventional proved gas reserves. In Mexico, recoverable shale gas is 32 times greater than its conventional proved gas reserves. 

Figure: Argentina Natural Gas Production and Imports

Figure: Mexico Natural Gas Production and Imports


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