Neuquén advances strategic agreements to export Vaca Muerta gas to Brazil, targeting São Paulo industrial demand

Neuquén Province is formalizing steps to export significant volumes of gas from the Vaca Muerta formation to Brazil, driven by growing energy demand in Sao Paulo’s industrial sector. Recent agreements and consortia formations highlight efforts to establish long-term contracts, infrastructure investments, and integration of regional gas markets, positioning Neuquén as a key energy supplier in South America.

The Governor of Neuquén, Rolando Figueroa, has engaged directly with Brazilian industrial stakeholders through meetings with GásBra Energía SA, a consortium representing São Paulo’s industrial gas consumers, and Garantía Capital Ltd. These discussions aim to define production, transportation, and commercialization frameworks for Vaca Muerta gas exports. A notable outcome was the signing of a non-binding Declaration of Understanding during the Offshore Technology Conference (OTC) in Rio de Janeiro, outlining cooperation on investment, technical collaboration, and sustainable energy integration.

Projections indicate that Vaca Muerta could supply between 45 and 50 million cubic meters of natural gas daily to Brazil, with destinations including São Paulo’s industrial hub and the Rio Grande do Sul region. The preferred export route is a direct gas pipeline from Neuquén to Porto Alegre via Uruguayana, involving an estimated investment of USD 1 billion. This direct pipeline is favored over alternatives through Bolivia or Paraguay due to fewer regulatory risks.

Brazilian industry representatives stress the necessity of competitive pricing and long-term contracts, with current price targets around USD 7 per MMBTU. Logistics enhancements in Neuquén, such as ongoing authorization of the Neuquén airport for exports of regional products and infrastructure upgrades like the Turboexpander plant at Centenario, support broader trade facilitation.

Additionally, Brazilian company FLUXUS, part of J&F Group, began operations in Vaca Muerta with plans to invest over USD 21 million to reactivate key exploration blocks, signaling growing foreign investment interest. Petrobras also remains active in the region, advancing export capabilities through established assets.

The Neuquén government’s integrated strategy encompasses strengthening technical expertise, solidifying export markets in Brazil, and leveraging existing hydrocarbon experience. This positions Vaca Muerta not only as a regional gas supply pillar but also as a driver of economic growth through expanded energy trade and industrial collaboration.