Pampa Energía/TGS proposes us$800M gas pipeline for Argentina shale boom

Gas transporter TGS, controlled by Pampa Energía, has proposed an us$800 million pipeline and gas treatment plant in Argentina's Vaca Muerta shale fields, aiming to address a key barrier to increasing production. The project could be built in 18 months and would transport gas produced by companies including state-run YPF SA, Tecpetrol, Dow, Exxon Mobil, BP Unit Pan American Energy, Wintershall, Total, and Statoil that so far this year have announced an us$1.15 billion joint investment in Vaca Muerta, and Tecpetrol, part of the Techint Group, said it would invest other us$2.3 billion.

Argentina's President Mauricio Macri has made attracting investment to ramp up natural gas production a priority of his government, which is trying to end reliance on costly energy imports. But expanded output is limited by current pipeline capacity in the remote, Belgium-sized fields.

Pipelines in Vaca Muerta are currently moving 60 million cubic meters of natural gas per day and have capacity for 75 million. This new pipeline would have an initial 4 million cubic meters capacity that could be expanded to 35 million cubic meters. Rival gas transporter TGN, controlled by Tecpetrol - part of conglomerate Techint - is also interested in building another pipeline or partnering with TGS.