Argentina launches new Plan Gas round

Argentina’s federal energy department launched a new round of production incentives scheme Plan Gas, with the central aim of boosting local output to substitute imports over winter months.

Officials seek to secure 5.5Mm3/d (million cubic meters a day) from E&P firms from May 2022 to December 2024. This consists of 3Mm3/d from the Neuquina basin, 1.5Mm3/d from the south and 1Mm3/d from the northwest. 

The price ceiling will be the maximum offered in the first round of Plan Gas, according to a resolution.

Officials will receive bids until November 2 and are due to announce award decisions on November 10. Winning parties are granted supply contracts.

In the first Plan Gas round, held last year, authorities received offers to supply 63.6Mm3/d to wholesale power market administrator Cammesa and distributors during the winter periods in 2021-24. They had hoped to close contracts for 70Mm3/d, and later held a smaller, follow-up round.

Federal energy chief Darío Martínez said Argentina must fully utilize existing gas transport capacity. Vaca Muerta gas dispatch infrastructure is becoming strained in winter months amid rising output. The government wants to support growth of the country’s natural gas industry by expanding capacity via new ducts.

Gas output has been growing in Argentina. In August, production was up 2.3% month-on-month and 6.4% year-on-year to 134Mm3/d, according to data from local think tank the General Mosconi energy institute.   

In the warmer months, Argentina has excess supply, which is piped to neighbors, chiefly Chile. E&P firms have filed more than 30 export requests this year.

REFINERY INVESTMENT

In related oil and gas sector news, state hydrocarbons company YPF is mulling investing US$200mn in the Plaza Huincul hydrocarbons processing complex in Neuquén province in 2022-24, media outlet Más Energía reported, citing YPF documents sent to local authorities. 

The move comes amid growing output of unconventionals and a decline in conventionals. 

YPF is also planning to carry out upgrade and capacity expansion work at its Luján de Cuyo complex, in neighboring Mendoza, according to local press.

In its last results call, YPF said it forecast oil production growth to outpace that of natural gas in 2022. 

A goal of the country is boosting crude production to help ramp up exports.