November 28, 2024 [Reuters]- Grupo Matrix Energia of Brazil and TotalEnergies of Argentina confirmed their first deal with Bolivia’s state energy company, YPFB, to transport natural gas from the massive Vaca Muerta shale formation in Argentina as the region faces a supply shift.

Under the contract signed on Nov. 22, Yacimientos Petroliferos Fiscales Bolivianos (YPFB) will move Argentine natural gas to Brazil using Bolivian transport infrastructure, representatives from the two companies told Reuters on Wednesday.

YPFB had issued a statement on Tuesday saying the deal was a crucial step in enabling gas supplies from Argentina to reach Brazilian consumers and strengthened the “regional energy integration process.”

Exports from Bolivia, once a prominent producer in the region, have declined rapidly in recent years, forcing neighbors Argentina and Brazil to seek alternatives. Supply to Argentina ceased in September, while volumes to Brazil have been renegotiated in recent years.

Argentina has the world’s second largest shale gas reserves and is seeking to position itself as a gas exporter, though the country is still developing a pipeline network to transport the fuel and build the commercial framework needed for negotiating tariffs.

As part of the deal signed in the Bolivian city of Santa Cruz last week, YPFB said its gas transportation companies are authorized to operate and manage the flow of natural gas through its existing pipeline network that stretches roughly 1,000 km (600 miles) connecting Argentina with Brazil.

TotalEnergies, the Argentine unit of the French oil company TotalEnergies, and Matrix Energia also signed a purchase and sales contract.

TotalEnergies obtained two permits to export natural gas from the Austral and Neuquen Basins to Brazil, YPFB said.

TotalEnergies declined to comment further.

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