Brazil and Argentina have signed a Memorandum of Understanding to explore gas exports from the Vaca Muerta formation to Brazil, aiming for potential imports of up to 30 million cubic meters per day by 2030. A working group will identify routes for this gas supply, supported by significant investments, particularly as Brazil grapples with rising domestic gas demand.
Brazil and Argentina have formalized a Memorandum of Understanding (MOU) to investigate the creation of infrastructure for natural gas exports from Argentina’s Vaca Muerta reserves to Brazil. This agreement seeks to cater to Brazil’s increasing gas demands, with projections estimating imports could reach 30 million cubic meters per day (mcm/d) by 2030. A working group will be established to outline the necessary measures for this gas supply, particularly focusing on the Vaca Muerta formation, recognized as the second-largest shale gas reserve globally. YPF, Argentina’s state oil company, is taking the lead in activities at Vaca Muerta to enhance Argentina’s energy export capabilities. This group will also evaluate potential routes for delivering gas to Brazil, such as altering the flow of Bolivia’s pipeline and two alternative routes through Paraguay and Uruguay. Additionally, an analysis of a possible direct pipeline connection at Uruguaiana, a border city in Brazil, is on the agenda. Minister Alexandre Silveira of Brazil’s Mines and Energy highlighted that, initially, Brazil could import approximately 3 mcm/d from Argentina, with aspirations reaching up to 30 mcm/d by 2030. Notably, despite being Latin America’s predominant crude oil producer, Brazil’s gas production currently does not meet its domestic needs, thus making this initiative crucial for President Luiz Inacio Lula da Silva’s administration. In support of these developments, Vista Energy has announced plans to invest around $1.1 billion to augment its operations in Vaca Muerta, aiming to boost production levels while minimizing costs. The rapid expansion of the Vaca Muerta shale formation, regarded as one of the world’s largest outside the United States, indicates its potential to play a significant role in energy exports from Argentina to Brazil.
The agreement between Brazil and Argentina emerges against the backdrop of an escalating demand for natural gas in Brazil. As the country seeks to bolster its energy security, reliance on imports from Argentina’s Vaca Muerta formation, one of the largest shale gas reserves, offers a viable solution. The ongoing challenges faced by Brazil in meeting domestic gas demands further emphasizes the need for collaborative cross-border energy initiatives. YPF’s involvement in Vaca Muerta underlines Argentina’s ambition to emerge as a key player in the energy sector.
The signing of the MOU between Brazil and Argentina signifies a strategic partnership aimed at facilitating gas exports from the Vaca Muerta formation to Brazil. With ambitious targets for future gas imports and significant investments planned in the region, both countries are positioning themselves to bolster their energy sectors. This initiative not only serves Brazil’s urgent gas supply needs but also enhances Argentina’s role in regional energy dynamics.
Original Source: www.offshore-technology.com
