The rumor that the company Petronas It would be considering abandoning the project to build an LNG plant together with YPF It shook the energy sector and had obvious echoes in national and provincial disputes due to the magnitude of the investment involved and its importance for the country’s coffers. The version has not been denied, but the project will continue, according to the national oil company, with or without the Malaysian company.
“At that point, Petronas has the option of continuing or not with the project. The situation must be played down, these are business decisions. I have no information on what Petronas’ decision would be. It is one of the best LNG companies in the world and we are working very well with them,” said the president of YPF, Horacio Marin. And, in statements to radio El Observador, he added: “If Petronas does not continue, YPF will continue. It is a project that is of great interest. The project does not depend exclusively on Petronas. Other companies can enter.”
The governor of the province of Río Negro had spoken earlier along the same lines, Alberto Weretilneck, where the plant would ultimately be built. He said that if it is not with Petronas, it will be with another company, but that it will be built.
Interestingly, in the midst of these versions, The Casa Rosada has circulated a photo of a meeting held today by President Javier Mileial with the CEO of TotalEnergies, Patrick Pouyanne, and other senior executives of the company.
The project is key for Argentina, to resolve one of the main factors that impact the trade balanceWith the LNG plant, the country would save billions of dollars in purchasing this fuel abroad, and could also export some US$15 billion in 2030, according to YPF.
In this first stage of the project, Marín himself explained, work is being done on the engineering, which would require some US$200 million.
Petronas has not commented on the matter. The company’s management has long since given the order not to discuss anything related to the project.
With this, the novel of the installation of the LNG plant adds a new chapter. It is worth remembering that its construction was initially planned in Buenos Aires, but after a bidding war that included the national government of Javier Milei and that of the Province, of Axel Kicillof, its location in Río Negro was imposed, a change that was first reported by Energy Report.
The plant will be planned in the area of Red Pointin the Rio Negro town of Sierra Grandewhere the modernisation and enhancement of an old, disused port with access to the Atlantic Ocean will also take place. The total investment in the project, which is expected to be completed within a decade, is US$30 billion, in different stages.
Finally, after a thorough study commissioned by an international consulting firm, the choice that prevailed was to install the plant in Black Riverover the initial proposal to build it in Bahia Blancain the province of Buenos Aires.
The port installed in the Gulf of San Matias It has special qualities for the access of large vessels, with a depth of 40 meters seven kilometers from the coast, which allow free access without interference. In addition, accessibility is highlighted with National Route No. 3 and the San Antonio Oeste Airport.
Río Negro became the first province to officially adhere to the Large Investment Incentive Scheme (RIGI), on July 12. This step was essential to gain an advantage over the province of Buenos Aires.
Argentina LNG project and the relationship between YPF and Petronas
Petronas It is the second most important partner for YPF by investment volume. The relationship began in late 2014 when they signed a partnership for the development of the bloc Unconventional The Bitter Girl in Vaca Muerta, Neuquén, where the state-owned company Malaysia has invested US$1.5 billion.
The YPF and Petronas project is part of the so-called 4×4 Plan of the state oil company, a 10-year action plan, which includes an investment of US$10 billion for the plant alone and another US$20 billion in complementary works.
The initiative includes gas production in Vaca Muerta, its transportation by a 620-kilometer gas pipeline from the field to the processing terminal and its industrialization.
Once the final investment decision is reachedThe Argentina LNG Project (ARGLNG) is expected to allow the country to make a qualitative leap in the generation of foreign currency, with a total planned production capacity of 25 million tons of gas per year (MTPA), to be carried out in stages.
The LNG project, YPF’s big long-term bet
The development of LNG marketing Dead Cow to the world is the fourth pillar of 4×4 Plan of YPF’s president and CEO, Horacio Marín. They named it ARGLNG. The other three pillars are:
- focus management on what is most profitable: Dead Cow;
- divestment in conventional assets (sale of mature areas) and review of the participation of YPF in other companies;
- develop a more efficient operation in downstream and upstream;
The big news in LNG is that YPF will open up participation in the project to other companies. “It will be viable if a single project is carried out by all the companies in the country because the infrastructure is huge. To compete with the US, we have to invest together,” said the new directors.
He agreement with Petronas plans to start exporting LNG from 2027, with a LNG tanker. In principle, they would be about 6 mm3/d. But two years later, a floating terminal is expected to be installed just for YPF and the Malaysians, and then another ship will arrive for use by the rest of the industry. At that time, total exports would climb to 40 mm3/d.
Finally, the third stage aims to launch a plant in 2031. LNG onshore, which would add another 40 mm3/d, and which together with four other strong companies in the sector, will produce a total of 80 mm3/d.
The ARGLNG initiative seeks to achieve exports of 120 mm3/d over the next decade, worth US$16 billion. The goal is to reach US$30 billion in exports by 2030.
Source: Ambito
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