Certain sources indicate that Chevron Corp, along with two other significant Argentine shale producers, is set to finalise contracts this week for a natural gas liquids project. This development strongly suggests that the US$3-billion initiative is poised to proceed. Certainly, Chevron, the prominent US supermajor, is looking to increase its activities in the Vaca Muerta shale basin. The company will collaborate with state-owned YPF SA and private energy firm Pluspetrol SA to establish contracts with TGS SA, the gas company spearheading the project. It is regarded as essential for preventing infrastructure bottlenecks in the rapidly expanding shale region.
Chevron confirms it is close to finalising agreements related to a gas processing and natural gas liquids infrastructure project in Vaca Muerta, alongside other industry participants’, the company stated in an email. YPF chose not to provide a statement. Pluspetrol refrained from providing any comments. TGS has not yet provided a response to the request for comment. The three drillers are expected to occupy approximately 80 percent of the project’s capacity, and finalising the contracts is a crucial step that aligns with TGS granting approval, referred to as the final investment decision, according to one source.
The project aims to convert natural gas, primarily associated gas extracted from oil wells, into liquid forms such as butane and propane for export purposes. TGS will cover a portion of the US$3-billion investment from its own resources, while the remainder will be financed through banks that are nearing agreement on terms. The liquids project represents one of multiple processing and pipeline export initiatives poised to transform Argentina’s shale industry into a significant global energy supplier in the years ahead.
Chevron’s investment in Argentina extends well beyond the gas liquids initiative. It has recently submitted an application to President Javier Milei’s signature investment programme, which encompasses tax incentives, for a US$13.8 billion oil drilling project. It signifies a notable influx of US investment in Argentina following Milei’s assumption of office.