Argentina’s Southern Energy, a consortium comprising PAE, YPF, Pampa Energía, Harbour Energy, and Golar LNG, has finalized a strategic agreement with the German state-owned energy firm Securing Energy for Europe to supply 2 million metric tonnes of LNG annually over eight years beginning in late 2027. This agreement marks Argentina’s largest-ever LNG export deal in both scale and duration, representing a pivotal step in the nation’s ambition to emerge as a global gas supplier. The understanding, formalized as a nonbinding heads of agreement, outlines that deliveries will commence once the Hilli Episeyo becomes operational. Southern Energy will deploy the first of two liquefaction vessels in the San Matías Gulf of Río Negro province. The vessel can produce 2.45 million tonnes of LNG per year, with more than 80% of its output contracted by SEFE, and the committed volume represents over 30% of the total capacity of both floating units. Although final revenues will depend on global prices, expected exports may exceed US$7 billion over the contract’s duration.
For Argentina, the deal ensures a dependable inflow of foreign currency and strengthens its position in the global LNG landscape by leveraging opportunities presented by Vaca Muerta. The agreement was signed under the leadership of Rodolfo Freyre and Frédéric Barnaud with representatives from PAE, YPF, Pampa Energía, Harbour Energy, and Golar LNG present. “It will be the first large-scale LNG sale from Argentina and marks a milestone for the future development of Vaca Muerta’s natural gas reserves,” Freyre said, expressing pride in partnering with a global entity like SEFE. From Germany, Barnaud emphasized Europe’s strategic interest: “This first LNG agreement between SEFE and a South American supplier contributes to the geographic diversification of our portfolio and strengthens Europe’s energy security,” noting satisfaction in supporting Argentina’s rise as a global LNG exporter. He added that the agreement will allow SEFE to maintain operational experience with the Hilli Episeyo, set to be relocated from Cameroon to Patagonia.
SEFE stands as a major player in the European Union’s energy sector, with annual gas and energy sales of 200 TWh, serving 50,000 customers ranging from small firms to global multinationals while participating in production, marketing, transport, and storage across the value chain. As a German government-owned entity, it is central to Europe’s energy security strategy, with investments extending into the energy transition and hydrogen sectors and a global workforce of around 2,000 people. Southern Energy, created to position Argentina as a major competitor in the global LNG market, has already secured more than US$15 billion in investment for the development of the project over 20 years. Projected LNG exports from 2027 to 2035 are expected to surpass US$20 billion, establishing Argentine gas as a long-term strategic resource. The project will generate 1,900 direct and indirect jobs during construction, largely within the local community, while ensuring high levels of domestic supplier participation in operations.
Recently, the MV Billion Star arrived at the port of San Antonio Este after traveling from Shanghai, China, carrying 10,000 tonnes of steel pipes for the LNG project’s pipeline construction. Its arrival strengthens integration among the energy, port, and metalworking sectors, generating widespread impact throughout the local value chain. The movement of materials, engagement of stevedoring and transport services, and involvement of specialized labor are set to boost employment and stimulate economic activity in the coming months. Each phase will reinforce the infrastructure required for the transport, processing, and export of gas from Neuquén, positioning the port of San Antonio Este as a critical hub within Argentina’s national energy framework.