Argentina Advances US$20 Billion Argentina LNG Project with Key Partnerships After Shell’s Exit

YPF and ENI finalized technical engineering for a project targeting 12 million tonnes per annum (MTPA) of liquefied natural gas exports from Vaca Muerta, aiming to expand capacity to 18 MTPA. The project, projected to generate around US$10 billion annually by 2030–2031, plans installation of two floating liquefied natural gas (FLNG) vessels off the coast of Río Negro, with suppliers including China’s Wison New Energies and South Korea’s Samsung. Financing efforts led by JP Morgan will target over US$12 billion in international capital, leveraging ENI’s and ADNOC’s participation to attract multilaterals and sovereign wealth funds. YPF plans to begin construction next year following the FID expected by mid-2026.

Shell’s withdrawal from the initial pre-front-end engineering design (pre-FEED) phase was driven by differing investment timelines; Shell retains interest in future project expansions but will no longer participate in the base phase. YPF is actively pursuing alternative global partners, including Saudi Aramco and ExxonMobil, to fill this gap. Despite Shell’s exit, YPF’s LNG export contract footprint solidified with a 2 million tonne per year agreement with German firm SEFE, valued at approximately US$875 million annually.

The project aligns with Argentina’s strategic reduction of state energy involvement, as ENARSA transitions LNG import and commercialization responsibilities to the private sector to enhance market efficiency and supply reliability. This LNG export initiative is a cornerstone of Argentina’s broader “Plan 4X4,” which aims to transform YPF into a shale production and hydrocarbon export leader by 2031. The success of this project depends critically on securing stable regulatory conditions, competitive pricing structures, and uninterrupted financing amid global LNG market shifts.