YPF, Adnoc’s XRG and Eni to advance Argentina LNG project

Argentina’s state oil firm YPF, Italy’s Eni and Abu Dhabi National Oil Company’s international investments arm XRG signed a binding joint development agreement to advance Argentina LNG, a project expected to reach a liquefied natural gas capacity of 12 million tons per annum, XRG said on Thursday.

The deal marks XRG’s formal inclusion and the three companies will work to reach a final investment decision in the second half of 2026, YPF chief executive Horacio Marin said in a statement.

“This large-scale integrated gas and liquefaction project will unlock Argentina’s Vaca Muerta shale basin and help position the country as a long-term global LNG supplier,” the statement said.

The huge Vaca Muerta formation in western Argentina accounts for most of the country’s oil production even though a small part of it is under development. It is vital to Argentina’s economic future and President Javier Milei’s government, which needs to increase energy exports to bolster Argentina’s dollar reserves and build confidence in the government’s ability to maintain a stable currency.

For Abu Dhabi, the deal helps towards a stated goal for XRG to reach 20-25 million mtpa of LNG capacity by 2035. XRG was set up to hunt for acquisitions in natural gas, chemicals and energy solutions, acquiring Germany’s Covestro and merging its polyolefins unit with that of Austria’s OMV.

Further reading:

• Adnoc and Masdar look at Germany for new energy ventures
• Adnoc Gas targets early launch of Ruwais LNG
• Adnoc supercharges gas output to fuel data centres