Argentina Eyeing Gas Pipeline, Production Incentives
Argentina’s energy secretariat is said to be planning a tender for construction of a pipeline that would transport natural gas from the Neuquen Basin to Rosario, at a cost estimated at between $1bn and $1.5bn, local media outlets reported February 20.
Alternatives under consideration by officials at Argentina’s finance ministry revolve around tying the gas pipeline tender to the launch of a new hydrocarbon production incentive plan to specifically increase gas supply during the winter months, with an aim to displace LNG imports. Argentina spent nearly $1.2bn last year to import LNG, online media outlet EconoJournal said, citing official data.
The dual launch aims to attract investment to ensure increases in Argentina’s gas production, while at the same time guaranteeing transport capacity. Both measures would help Argentina monetise its vast unconventional shale gas resources, estimated at 802 trillion ft3.
But the plans face headwinds as recent modifications to Argentina’s gas subsidy scheme, or Resolution 46, could weaken investor confidence and slow growth in the country’s unconventional resources, rating agency Moody’s said earlier this month.