Chevron and Shell join the new Vaca Muerta pipeline project

Chevron and Shell confirmed their entry as shareholders of Vaca Muerta Oil Sur (VMOS), the company leading the construction of a 430-kilometer (267-mile) pipeline between Neuquén and Río Negro.

The project, which already includes the participation of YPF, Vista Oil & Gas, Pan American Energy (PAE), Pluspetrol, and Pampa Energía, aims to increase the crude oil transportation capacity of Vaca Muerta, facilitating a leap in the country's oil exports.

Details of financing and project progress

The total estimated investment is USD 2.5 billion.
VMOS obtained an initial syndicated loan of USD 1.7 billion from five international banks.
The remaining 30% will be contributed by the project's partner companies.
Government approval is expected for the project to access the benefits of the Incentive Regime for Large Investments (RIGI).

Chevron y Shell se suman al proyecto del nuevo oleoducto de Vaca Muerta

Since January, construction has progressed with:

Mobilization of contractors.
Earthworks.
Delivery of pipes.

Maximiliano Westen, a member of YPF's Executive Committee, detailed to Infobae that the target financing structure is 70% debt and 30% equity, ensuring the project's viability in the medium term.

Chevron and Shell confirmed their entry as shareholders of Vaca Muerta Oil Sur (VMOS), the company leading the construction of a 430-kilometer (267-mile) pipeline between Neuquén and Río Negro.

Details of financing and project progress

The total estimated investment is USD 2.5 billion.
VMOS obtained an initial syndicated loan of USD 1.7 billion from five international banks.
The remaining 30% will be contributed by the project's partner companies.
Government approval is expected for the project to access the benefits of the Incentive Regime for Large Investments (RIGI).

Since January, construction has progressed with:

Mobilization of contractors.
Earthworks.
Delivery of pipes.

Capacity and export projection

The pipeline will allow the transportation of up to 550,000 barrels of oil per day starting in the second half of 2027.
Its design allows for a future expansion to 700,000 barrels per day.
It is expected that crude oil exports from Vaca Muerta could exceed USD 20 billion annually by 2027.
Argentinian oil's competitiveness in international markets, especially in Asia, will be improved through the connection with VLCC (Very Large Crude Carriers), optimizing logistical costs.

Key infrastructure: the maritime terminal in Punta Colorada

VMOS's export plan includes a maritime terminal in Punta Colorada, Río Negro, from where:

An underwater pipeline will connect with dispatch buoys.
The loading of VLCC ships will be facilitated, optimizing international transport.

This scheme will allow large-scale exports, consolidating Vaca Muerta's production in the global market.

Economic impact and regional development

The investment will generate employment and growth in Neuquén and Río Negro.
The increase in production will consolidate the oil sector as a key driver of the Argentine economy.

According to a PwC report, Argentina could achieve an energy surplus of USD 30 billion by 2030, matching the foreign exchange generation of the agro-export sector.

The development of Vaca Muerta represents a historic opportunity for the country, ensuring foreign exchange, investments, and a strategic positioning in the global energy market.