LatAmOil: Argentina’s electricity export earnings will fund Vaca Muerta gas pipeline

Argentina expects to use the proceeds of electricity exports to Brazil to finance two major infrastructure projects that will facilitate the development of the Vaca Muerta shale formation.

News of these plans emerged after the Energy Secretariat adopted a new ruling governing the use of export revenues. Under this ruling, known as Resolution 1037, the government department will be able to cover the cost of building new energy infrastructure networks.

These networks will include a new natural gas pipeline and high-voltage power transmission lines that will serve the Vaca Muerta fields. The pipeline will carry a price tag of $1.8bn, while the transmission lines will be built within the framework of Argentina’s Federal Plan for Electric Transportation Works, which will require about $3bn worth of investments.

Pablo González, the CEO of Argentina’s national oil company (NOC) YPF, said last week that the pipeline would help support upstream development operations at Vaca Muerta fields. This project is among “the most urgent in the country,” he said.