Argentina’s GNL Project: PAE and Golar LNG’s $7 Billion Investment for 2027 Export

Pan American Energy and Golar LNG Plan LNG Exports from Argentina by 2027

Southern Energy, a partnership of Pan American Energy (PAE) and Golar LNG, has submitted a request to join the Large Investment Incentive Regime (RIGI). Their goal is to establish a liquefaction vessel in Argentina to produce Liquefied Natural Gas (LNG) and export it starting in 2027. The project will utilize natural gas from Vaca Muerta and represents an investment of $2.9 billion over the next ten years, with total expenditures expected to reach $7 billion over the project’s 20-year lifespan.

PAE emphasized that the project meets the conditions set by the Basis Law and the regulatory decree 749/2024. This status could position Argentina as a new player in the global LNG market, enabling the country to export products not currently sent abroad and access new markets.

The first phase of this initiative, running from 2025 to 2031, involves deploying the “Hilli Episeyo” LNG vessel in the Gulf of San Matías, Río Negro. PAE reports that this phase requires an investment of over $1.65 billion. The vessel can produce 11.5 million cubic meters of gas daily. The second phase, from 2032 to 2035, aims for expansion with an additional investment of $1.25 billion.

PAE and Golar LNG are negotiating with gas production companies, including the state-owned YPF, for partnership opportunities. The overall investment across both phases is around $2.9 billion, totaling nearly $7 billion for the project’s full lifecycle. The Gulf of San Matías has conditions similar to those off the coast of Kribi, Cameroon, where the “Hilli Episeyo” has successfully produced over 8 million tons of LNG.

The project is expected to create 600 new direct and indirect jobs during construction, with around 850 jobs during operation. Over 50% of the materials and services required will come from local suppliers. PAE aims to develop local suppliers to stimulate value creation within the country.

This LNG project is the sixth to enter the RIGI, which now includes investments totaling nearly $8 billion. Previous projects benefiting from this regime include investments from Minas Argentinas S.A, Galán Lithium, Posco, YPF Luz, and YPF’s Vaca Muerta Sur project.

Argentina boasts the second-largest unconventional natural gas reserves and the fourth-largest oil reserves globally, positioning it to leverage these resources amid the ongoing energy transition. With this project, Argentina hopes to join top LNG-exporting nations like the United States, Russia, Qatar, and Australia.

Additionally, YPF plans to construct a liquefaction plant in Punta Colorada, Río Negro, set to begin LNG exports in 2031.