The growth of Vaca Muerta, with a projected investment for the current year of US$8,000 million, is one of the main commitments of the business sector and national and provincial authorities, due to its potential to supply oil and gas to the domestic market and to export to the world, once the distribution bottlenecks have been corrected through gas and oil pipelines.
Just last year, the formation achieved an all-time record with production averaging 308,000 barrels of oil per day and 92 million cubic meters of gas.according to a report prepared by the Government of Neuquén.
For this year the prospects are even more ambitious with a forecast of more than 400,000 barrels of oil per day and a gas production that will exceed 100 million cubic meters during the peak of winter, thus leading the country towards energy self-sufficiency and, in the not too distant future, as a supplier worldwide.
For the next few years, the expectation of the industry is to reach the mark of at least 750,000 barrels per day of crude oil and 150 million million cubic meters of gas.
To reach these figures, in terms of investment, companies disbursed US$6 billion in 2022, an amount that will rise to US$8 billion this year.
“If Vaca Muerta were not there, last year we would have had to buy energy from the world for more than US$20.3 billion, and this year for almost US$21.655 million,” said the governor of Neuquén, Omar Gutiérrez, during the inauguration -a last week – of the Sierras Blancas-Allen pipeline built by a consortium made up of Shell, Pan American Energy (PAE) and Pluspetrol.
“If Vaca Muerta were not there, last year we would have had to buy energy from the world for more than US$20.3 billion, and this year for almost US$21.655 million”Omar Gutierrez
Most of this saving was in terms of gas imports, totaling US$13.973 million in import substitution last year, while for this year Vaca Muerta is expected to allow savings of US$15.900 million.
Within this framework, both businessmen and authorities compare the potential of Vaca with the Permian Basin, the most important unconventional shale gas and shale oil formation in the United States.
The Permian Basin is located in the southwest of the North country and currently produces about 5 million barrels of crude oil per day, on track to represent half of US oil production.
“Vaca Muerta I believe has the potential to become the `Permian` of South America, bringing wealth and prosperity to Argentina and its people”said Shell Deepwater executive vice president Paul Goodfellow, basing his comparison on the quality of the rock and the resource.
Although there is still a contrast between the production levels of both basins, Goodfellow specified that the US basin “is more advanced in its development phase.”
Only in the case of Shell, the company’s production in Vaca Muerta increased from 6,000 to 45,000 barrels per day in the last five years with an accumulated investment to date of US$2,000 million, of which more than US$500 million were in 2022.
“With these record levels of production and productivity, we not only compete nationally but internationally”emphasized Ricardo Rodríguez, president of Shell Argentina.
The oil company’s investment plan provides for the construction of a processing plant in Bajada de Añelo, with a capacity of 15,000 barrels per day.
Gutiérrez, during a contact he had with the press after the inauguration of the pipeline, stated that with 2,000 wells -10% of those in the Permian Basin- Vaca Muerta has higher “indicators of efficiency, productivity and geological quality”.
“Over and over again when we are asked about the scalability and potential of Vaca Muerta, we say that it is superior to that of `Permian`”, remarked the provincial president.
Both businessmen and government authorities agree that to speed up the development of Vaca Muerta it is necessary to improve the evacuation of its production -known as the “midstream” phase in the chain- to reach the domestic market and export points, since the production grew at a rate greater than the existing distribution infrastructure can support.
“Vaca Muerta needs for its development and to be able to reach the local and international market not only the drilling of wells but gas pipelines, oil pipelines, treatment and drying plants, and ports”indicated German Macchi, country manager of Pluspetrol.
The inaugurated Sierras Blancas pipeline, which has a capacity of 125,000 barrels of crude oil per day -the first of its kind driven by private investment-, will be joined by the President Néstor Kirchner Gas Pipeline with its first section scheduled for next June.
The gas pipeline that will connect the town of Tratayén in Neuquén and Salliqueló in Buenos Aires, will save more than US$ 2.9 billion between import substitution and reduction of subsidies.
The gas pipeline has a second section projected to San Jerónimo, in Santa Fe, which will allow the export of gas to Brazil.
Likewise, the Duplicate Project is planned, undertaken by the Oldelval firm, which intends to bring the current trunk transportation capacity of crude oil from 36,000 cubic meters per day to 86,000 between the Allen pumping station and Puerto Rosales in Bahía Blanca, which will allow increasing exports of the country at between 230,000 and 320,000 barrels per day.
For its part, there is also the upcoming inauguration of the Transandino Pipeline (Otasa) that will link Vaca Muerta with Chile and whose rehabilitation tests began last November.
The pipeline, with a transport capacity of 110,000 barrels per day and which has been without activity since 2006, is scheduled to be reactivated “in March or April,” Gutiérrez said.
