Argentina Signs LNG Export Deal with India, Targets $30 Billion Revenue

Argentina’s state-owned oil company YPF signed a memorandum of understanding with three Indian firms on January 21, 2025. The deal aims to export up to 10 million tons of liquefied natural gas (LNG) annually to India.

YPF’s CEO Horacio Marin announced the agreement in New Delhi after meeting with Indian officials. The partnership involves India’s Oil and Natural Gas Corporation, Gas Authority of India Limited, and ONGC Videsh Limited.

It extends beyond LNG to include cooperation in lithium, critical minerals, and hydrocarbon exploration. This move aligns with Argentina’s goal to become a major energy exporter. YPF plans to generate $30 billion in revenues over the next decade through energy exports.

In addition, the company is developing the Argentina LNG project, which could reach 30 million tons of annual LNG production by 2032. This ambitious venture requires an estimated $30 billion investment.

The project will tap into Argentina’s vast Vaca Muerta shale formation. Vaca Muerta holds the world’s second-largest shale gas reserves. YPF has been a pioneer in exploiting this resource since 2011. The company now controls 42% of gas acreage in the region.

Argentina Signs LNG Export Deal with India, Targets $30 Billion Revenue. (Photo Internet reproduction)

YPF’s strategy involves a phased approach to LNG development. The first phase aims to bring 1-2 million tons of capacity online by 2027 using floating LNG facilities. Subsequent phases will expand production through onshore plants.

Opportunities and Challenges

The company is actively seeking partners to support this growth. The Indian deal follows YPF‘s recent agreement with Shell to develop the first phase of the Argentina LNG project.

This partnership replaced an earlier collaboration with Malaysia’s Petronas. YPF is also exploring potential markets in Israel, South Korea, and Japan. Argentina’s LNG ambitions face challenges.

The country needs significant infrastructure investments to realize its export goals. President Javier Milei’s free-market approach relies on tax incentives rather than direct state funding.

This shift marks a departure from previous government strategies. Global LNG demand projections add uncertainty to Argentina’s plans. Some analysts predict a decline in demand from 2030 onwards.

However, YPF remains optimistic about the long-term prospects for natural gas in the global energy mix. The success of Argentina’s LNG exports could transform the country’s economic outlook.

It would diversify export revenues and strengthen Argentina’s position in global energy markets. However, the path to becoming a major LNG exporter requires overcoming significant financial and logistical hurdles.