Eni and YPF sign deal, move closer to FID on Argentina LNG project

Italian energy giant Eni and Argentina’s state-run firm YPF inked a preliminary agreement to take a positive final investment decision (FID) on the Argentina LNG project, Eni announced on October 10.

The Final Technical Project Description (FTPD) was signed in a meeting between Eni’s CEO Claudio Descalzi and YPF President and CEO Horacio Marin. Descalzi also met with Argentinian President Javier Milei during his visit.

The deal is one of the final steps before taking FID. Momentum has been building for the 12mn tonnes per year (tpy) project in recent months. In June, the two companies signed an agreement for participation laying out a roadmap to reaching FID.

Meanwhile, in mid-April the two parties also signed a Memorandum of Understanding (MOU), which delegated Eni to the development of upstream, transportation, and gas liquefaction facilities during the project phase for the initial two floating LNG (FLNG) vessels, which will both have a production capacity of 6mn tpy. Argentina LNG is an integrated upstream-midstream project.

“We are proud to have been chosen for such an important project and to contribute to the development of Argentine liquefied natural gas, which will represent a significant source of supply for international markets” Descalzi said in a statement.

“The specific and distinctive expertise we have developed in the FLNG projects in Congo and Mozambique makes us an ideal partner for implementing this type of project,” Descalzi added.

Earlier in October, Eni took a positive FID on the Coral North FLNG project in northern Mozambique.

The feedgas for the project will be sourced from Argentina’s vast Vaca Muerte shale formation, which boasts the world second largest shale gas reserves and stretches across a total area of about 30,000 square kilometres.

Expansion proposals for the project could see a phased approach integrated that would increase the project’s production capacity to as much as 30mn tpy by 2030.