Argentina’s YPF is to team up with rival gas developers Pan American Energy Group and its partner Golar LNG on their floating LNG production project.
YPF chief executive Horacio Marin confirmed the move in a post on LinkedIn on Monday. Pan American chief executive Marcos Bulgheroni replied saying that he is excited for the two to work together.
YPF, which had previously been working with Malaysia’s Petronas, and the Pan American-Golar pairing had both been pursuing separate FLNG projects to monetise Argentina’s huge Vaca Muerta shale gas deposit.
The tie-up unites Argentina’s top two oil and gas producers, YPF and Pan American, in which BP holds a 50% stake.
It also boosted Golar’s US share price to a new high, up 11.7% to close at $41.24.
But it leaves questions over Petronas’ involvement in any Vaca Muerta FLNG developments.
Earlier this year, Petronas and YPF invited companies to offer in on the initial design work for up to two FLNG units with capacity of 4 mtpa to 4.5 mtpa.
In a results call this month, Golar LNG revealed that Pan American had issued a 20-year reservation notice in October for Golar’s existing Cameroon-based FLNG unit Hilli for the Vaca Muerta shale deposit in the Neuquen Basin.
Golar said work on definitive contracts is ongoing and a final investment decision is expected within the first quarter of 2025.
LNG exports are scheduled to start within 2027.
Golar also detailed that it will gain commodity exposure on the project from its 10% stake in recently established Southern Energy, a joint venture with Pan American that will be responsible for the purchase of domestic natural gas, operations and sale and marketing of LNG volumes from Argentina.
The company, which greenlighted its first Mk II, 3.5-mtpa LNG carrier-to-FLNG unit conversion in September, said that linking the Vaca Muerta formation via a dedicated pipeline could support a multi-FLNG project in the future.
The as-yet uncommitted conversion is due for delivery in 2027 with Golar holding an option on a second unit at CIMC Raffles shipyard in China.
Last week Pan-American and Golar joined other energy and mining companies in applying for tax and foreign exchange benefits under a new government initiative.
