Argentina advances LNG export strategy with second FLNG vessel
Argentina is expanding LNG export capacity through the addition of a second floating LNG (FLNG) vessel as part of a midstream development led by Southern Energy, a joint venture comprised of Pan American Energy (PAE), YPF, Pampa Energía, Harbour Energy, and Golar LNG.
The new unit, MKII, is under construction at a shipyard in China and is scheduled to arrive in Argentina in 2028. The vessel will be moored in the Gulf of San Matías, off the coast of Río Negro province, and will have a production capacity of 3.5 million tonnes per year (tpy) of LNG.
MKII will operate alongside the FLNG Hilli Episeyo, which is expected to begin operations in early 2027. That vessel will process 2.45 million tpy. Combined, the two units will enable Argentina to export up to 6 million tpy of LNG—about 18% of the country’s current peak seasonal gas production.
Southern Energy has formalized a 20-year lease agreement with Golar LNG for both vessels.
Final investment decision (FID) has been reached for Hilli Episeyo. Total investment for the initial phase, including vessels, terminal operations, and upstream integration, is estimated at $7 billion over 20 years.
The FLNGs will require construction of a dedicated pipeline linking Argentina’s Vaca Muerta shale gas formation with the coastal liquefaction site.
The development has secured key permits, including a 30-year free export authorization from Argentina’s energy authorities and an environmental impact clearance from the government of Río Negro province.
Argentina’s long-term LNG vision
Argentina’s LNG roadmap targets an eventual export capacity of 30 million tpy by 2030, which would require doubling current national gas output and implementing up to three new long-distance pipelines similar in scale to the 36-in. OD, 573-km Perito Moreno line, which was completed in 2023.
In parallel to the Southern Energy project, YPF is pursuing construction of four additional LNG vessels through partnerships with Eni and Shell, also under construction in China.
Cumulative investment across the entire LNG strategy, including upstream and midstream components, is projected to exceed $22 billion.
Camilo Ciruzzi | South America Correspondent
Ciruzzi is a journalist based in the Argentine province of Río Negro. He has over 30 years of experience in radio and print media. Ciruzzi studied Communication Sciences at the University of Buenos Aires and specialized in energy, political economy, and finance.
