Argentina preparing for spring-summer firm gas exports to Chile

Argentina published 11 natural gas export authorization requests in February, the same number as the previous month, according to data from the federal energy department. 

All requests correspond to transactions between Argentine sellers and purchasers in Chile, the biggest buyer of Argentine gas.

Against a backdrop of an upward trend in production in Argentina, driven by shale and tight gas producers in the Neuquén basin, firm exports over the cold weather months of May-September have been given the green light.

The requests published in February are for firm exports in the warmer months of October, November and December.

EXPORT AUTHORIZATION REQUESTS

Seller: Pampa Energía
Buyer: Pampa Energía Chile
Maximum quantity: 398,320m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Pampa Energía
Buyer: Shell Chile
Maximum quantity: 208,209m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Total Austral
Buyer: Shell Chile
Maximum quantity: 663,218m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Pan American Energy
Buyer: Colbún
Maximum quantity: 200,000m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Tecpetrol      
Buyer: Enel Generación Chile
Maximum quantity: 850,000m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Tecpetrol
Buyer: Colbún
Maximum quantity: 400,000m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Tecpetrol
Buyer: Shell Chile
Maximum quantity: 250,000m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Mobil Argentina
Buyer: Trafigura Chile
Maximum quantity: 205,000m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Metro Holding
Buyer: Cinergia Chile
Maximum quantity: 36,050m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Shell Argentina
Buyer: Shell Chile
Maximum quantity: 9,691m3/d, firm basis
Dates: October 1, 2024 – December 31, 2024

Seller: Vista Energy
Buyer: Cinergia Chile
Maximum quantity: 429,736m3/d
Dates: October 1, 2024 – December 31, 2024

ARGENTINE GAS EXPORTS

In terms of Argentine gas exports, volumes fell 2% year-on-year in February to 9.88Mm3/d (million cubic meters a day), according to data from gas regulator Enargas.

Chile accounted for 9.79Mm3/d of the total, down 1% year-on-year, and Uruguay the balance.

Exports historically trough in May-September, Argentina’s cold weather period, characterized by increased demand. Last year, exports hit a nadir of 2.88Mm3/d in July.

In a context of dwindling availability of Bolivian gas and delays in getting a key midstream project executed, Chile could potentially export gas to northern Argentina this winter.

As things stand, and given the country is a net importer of gas, state control over gas exports appears set to remain in place under the government of President Javier Milei, while an easing is likely for oil.

A draft reworked version of Milei’s economic reform bill says gas export rules would be established by the executive branch, in accordance with hydrocarbons law No. 17,319. The draft also sets out authorization rules for LNG – a product Argentina hopes to produce and export one day.

Argentine gas production was 124Mm3/d in January, down 3.9% year-on-year, according to data from the General Mosconi energy institute think tank. A 4.8% rise in tight and shale gas was offset by a 14.5% reduction in output of conventional gas. Improved hydrological conditions and lower thermoelectric dispatch has dampened demand. 

A challenge for Argentina is flatting the demand curve, something that an LNG industry and growth in underground storage – an area covered in the draft – could help address.