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Eni SpA E, the Italian energy giant, has signed an agreement with Argentina’s state-backed oil and gas major, YPF Sociedad Anonima (YPF), to advance a large-scale LNG project on the country’s Atlantic coast. The memorandum of understanding (MoU) is aimed at jointly evaluating a critical phase of the Argentina LNG initiative centered around the prolific Vaca Muerta shale formation.
Under the agreement, the two companies will collaborate on developing the upstream, transportation, and liquefaction infrastructure required for two floating LNG (FLNG) units. These are expected to contribute 12 million tons per year (mtpa) of LNG, forming the foundation of the broader plan to export up to 30 mtpa by the decade’s end.
Eni CEO Claudio Descalzi emphasized the company’s strong technical capabilities in floating LNG, drawing on its successful project experience in countries like Congo and Mozambique. This background appears to have been a key factor in YPF’s decision to bring Eni on board as a strategic partner in the Argentina LNG initiative.
YPF president and CEO Horacio Daniel Marin conveyed optimism about the collaboration, viewing it as a step that could accelerate the project’s development. He also highlighted the rising global interest in securing natural gas supplies from the Vaca Muerta formation.
This formation, one of the largest shale gas reserves outside North America, lies at the heart of the project. Gas extracted from this resource will be transported via a 580-kilometer pipeline to the Sierra Grande Norte site in the Rio Negro Province.
The first phase of the project involves two FLNG units located near the shore. Phase two will introduce a 10 mtpa onshore modular liquefaction plant, with an eventual third phase adding two more trains to reach a full capacity of 30 mtpa.
YPF already holds a 54% stake in the Sierra Chata unconventional gas concession, operated in partnership with Pampa Energía. Located approximately 150 kilometers northwest of Neuquén, this asset is considered one of the most promising in Vaca Muerta.
This new agreement builds on YPF’s previous LNG-related MoUs with Indian firms ONGC, ONGC Videsh and GAIL, as the Argentine company continues to position itself as a reliable exporter of natural gas.
For Eni, the project fits squarely within its broader strategy to advance the energy transition. The company said that the move supports increased gas production while reducing emissions, contributing to its goal of achieving carbon neutrality by 2050.