Booming shale oil production from Vaca Muerta will generate energy trade surpluses for Argentina on the order of US$8 billion in a few years, Energy Secretary Flavia Royón said in an interview.
Drilling is recovering rapidly in Vaca Muerta after a series of false dawns over the past decade, while the oil major, state-owned YPF S.A., is poised to increase investment.
Pipeline expansion, one of the main production bottlenecks, is finally under construction.
A pipeline to Chile abandoned for years will begin transporting crude in May, Royón said.
YPF is also planning a new pipeline across the country to the Atlantic coast, where a new port would be built.
This is in addition to ongoing work to duplicate similar existing facilities.
Argentina’s chronic dollar shortage is a key source of imbalances in its crisis-prone economy and, over the years, has led to unorthodox policies, including capital controls and debt restructurings.
Trade surpluses are key to improving the situation.
Speaking at a conference in Toronto, Royón noted that in three to four years, there would be an US$8 billion positive energy trade balance driven by crude oil exports.
The government expects energy trade to balance this year after many years in the red, including a US$5 billion deficit in 2022, as fuel imports hurt a nation that was once comfortably a net exporter.
KEY STATEMENTS BY FLAVIA ROYÓN
- Argentina is in talks with lenders to finance an expansion of its natural gas and power transmission networks.
- The government is negotiating with different funds for the US$3 billion it still needs to build the second stage of the Néstor Kirchner pipeline, which would take shale gas from Vaca Muerta in Argentina to Brazil.
- A decree giving oil companies greater access to foreign currency amid exchange controls will come into force in the coming days after several companies filed applications to use it.
With information from Bloomberg