Argentina faces gas supply shortage amid new strike

Hours after an agreement with oilfield workers to end a strike in Argentina's Chubut and Santa Cruz provinces, a new work stoppage has halted natural gas production and dispatch from southernmost Tierra del Fuego province.

The energy and mines ministry said in a statement Tuesday night that the latest strike, launched to protest residential gas rate increases approved by the government in April, has cut off the supply of 16Mm3/d to Argentina's natural gas pipeline network, including to capital Buenos Aires.

Natural gas regulator Enargas called on consumers from the industrial segment to reduce their gas consumption to zero, and for thermal power generators to limit their offtake to the lowest amount necessary to prevent widespread power outages.

The ministry said Argentina is importing 1,200MW of electric power from neighboring countries to prevent supply interruptions and that the government is negotiating at least 3Mm3/d of additional gas imports from Chile, which began supplying regasified LNG to Argentina in May.

The ministry said that if the unions did not call off the strike Wednesday, supply of compressed natural gas (CNG) would be shut off for the entire country.

Unfavorable weather conditions have also delayed the arrival of LNG cargoes to Argentina, the ministry said, further complicating matters.

Union leaders told state news service Télam that 1,500-2,000 workers would halt activity in the zone, including stopping production at a gas processing and dispatch plant owned by the local subsidiary of French oil major Total.

A nearby plant owned by state oil company YPF would not be affected, Télam said. However, employees of downstream firm Refinor joined the strike, amplifying the fuel supply interruption.

Télam said gas rates have increased 400-2,500% for residential consumers in the country's Patagonia region, which comprises Tierra del Fuego, Santa Cruz, Chubut, Río Negro, Neuquén and La Pampa provinces.

Energy and mining minister Juan José Aranguren announced on May 23 that rate increases would be capped at 400% for Patagonia consumers, a conciliatory measure that politicians from the affected provinces called insufficient.