The provinces of Río Negro and Buenos Aires are very interested in the construction of a liquefied natural gas (LNG) plant, with an investment of between 30,000 and 50,000 million dollars, according to different estimates.
The Rio Negro government trusts that it will convince YPF/Petronas (from Malaysia) to establish the plant in its provincial territory, with the support of Neuquén, where the resource originates. “The Río Negro project in the San Matías Gulf is outstanding.”
The project includes the plant, a port and the corresponding gas pipelines in Sierra Grande. “The construction of a floating liquefaction plant will require an approximate period of two years, the installation of a pipeline line 600 kilometers from Vaca Muerta and the lifting of an onshore liquefaction plant. We must not forget that Neuquén is the producer, and as such it supports us“, commented from the Rio Negro government.
Below is a note published this Friday in Todo Noticias (TN), of Capital Federal.
The fight between two provinces intensifies over an LNG plant that will generate investments of US$40,000 million
Buenos Aires and Río Negro seek to retain a project to develop Liquefied Natural Gas. This is a joint initiative between YPF and Petronas, Malaysia. The key point that ties the fight to the future of the Bases Law.
By Sebastian Simonetti
While the focus of attention in the political discussion is on what can happen in Congress, there is a dispute that is tied to the future of the Bases Law and for which there are already intense negotiations underway. This is the possibility of installing a plant to develop Liquefied Natural Gas (LNG) in the country.
On these days, Two provinces are fighting over the possibility of the LNG plant being installed in their territory. These are Buenos Aires and Río Negro. The oil companies YPF and Petronas (Malaysia) are leading the project, which was called one of the “largest infrastructure projects” in Argentine history, with investments for between US$30,000 million and US$40,000 million from 2025 to 2031.
Thus, the national oil company is studying the possibility of developing the work in Bahía Blanca or Punta Colorada. But there is one more detail: the future of the project It is tied to Congress giving approval for one of the key points of the Base Law. “Without RIGI, there is no LNG”, is the phrase that resonates in several offices at this time. The objective of Horacio Marín, president of YPF, is to confirm this guarantee to Petronas so that it can accelerate its final investment decision before July of next year.
It happens that the RIGI grants a significant reduction in taxes, benefits for imports of inputs and labor without tariffs for those who make investments in the country. And a no less important fact: it establishes absolute freedom to dispose of the dollars from the third year of the investment.
However, the project also depends on other private oil companies such as Tecpetrol, Pampa Energía and Pan American Energy (PAE) providing financing.
The Buenos Aires proposal
“It is something that we have been working with YPF authorities since 2017,” the provincial government pointed out to TN. And they clarified: “Now we have made the formal proposal of the province’s interest.” In 2023, the reservation of 1,500 hectares was made on the Puerto Bahía Blanca property to be able to locate the plant there..
“We are working to continue the gas liquefaction plant project in the port of Bahía Blanca, which has to do with the recovery of YPF and the development of Vaca Muerta, to have a generation of LNG in our province. Given its importance, Governor Axel Kicillof declared it a project of provincial interest,” declared the Buenos Aires Minister of Production, Augusto Costa, days ago.
In the province of Buenos Aires they also maintain that the connectivity of the port of Bahía Blanca and the addition of having the fifth petrochemical hub in Latin America, specialized local labor and training centers, give it an advantage in the race to stay with the LNG plant. “Any circumstance that distances YPF from this decision is far from being the best for Argentina,” Mayor Federico Susbielles pointed out in statements to Radio Province.
Río Negro got into the dispute
But on the other hand, the Rio Negro government trusts that they will convince YPF/Petronas with their position to establish the LNG export plant megaproject in their provincial territory. “We must analyze the investment in LNG also within the framework of the national geopolitics“, he explained to TN the Minister of Government, Federico Lutz.
“We will redouble our efforts to be the best option for the pipeline, currently in execution,” he added. Lutz insisted that “there are synergies inherent to both investments (oil pipeline and LNG) due to the installed capacities that are achieved, benefits in the extension of the country’s industrial and service frontiers, and a maritime logistics in which Río Negro is presented as the best option”.
“We defend this investment for Patagonia as it is proposed. Governors Alberto Weretilneck and Rolando Figueroa have already said it, It is a strong political decision. Río Negro and Neuquén will fight for it,” he assured. “It is a political decision, strongly associated with RIGI and the investments that YPF announced. It is a political discussion, but for reasons of security, location and technical capacity“The Río Negro project in the San Matías Gulf is outstanding”the minister expanded.
The project includes the plant, a port and the corresponding gas pipelines in Sierra Grande. “The construction of a floating liquefaction plant will require a period of approximately two years, the installation of a pipeline line 600 kilometers from the heart of Vaca Muerta and the erection of a liquefaction plant on land. We must not forget that Neuquén is the producer, and as such it supports us”, he commented.
