December 20, 2024 [Reuters]- Argentina’s state-run oil company YPF and oil major Shell signed an agreement to develop the country’s flagship liquefied natural gas (LNG) project, the companies said on Thursday.

The multi-stage $50 billion Argentina LNG project aims to export the gas to major global markets.

The agreement, which was signed in the Netherlands, brings the Dutch oil giant on for the first phase of the project, which aims to produce 10 million metric tons of LNG per year.

“We are proud that Shell, a world leader in LNG production, is joining the project,” YPF President Horacio Marin said in a statement.

“As a pioneer in the LNG market, Shell’s knowledge and experience will be instrumental in helping to position Argentina as a reliable and competitive global energy supplier.”

The statement said that the agreement means Malaysian state oil company Petronas’ participation in the project had ended. It added that Petronas and YPF would continue developing the La Amarga Chica area in Vaca Muerta, the second largest unconventional gas reserve in the world and the fourth largest oil reserve.

Shell said in a separate statement that the LNG project “is aligned with Shell’s plans to continue growing its LNG business.”

Argentina LNG will also extract gas from Vaca Muerta and transport it through dedicated gas pipelines to the coastal province of Rio Negro. The first phase of the project will use LNG vessels while future phases envision the construction of onshore LNG facilities.

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