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Argentine government seeks bidders for Vaca Muerta gas pipeline

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Christian Fernsby ▼ | August 2, 2019
The government is seeking bidders to design and build the fourth natural gas pipeline serving the Vaca Muerta play, one of the world’s largest shale oil and gas fields, the Argentine Energy Ministry said.
Vaca Muerta gas pipeline
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The new pipeline will have an initial capacity to transport 15 million cubic meters per day of natural gas from the giant shale formation, which sprawls over 30,000 sq. kilometers (11,583 sq. miles) in four provinces.

The three existing gas pipelines – Neuba I, Neuba II and Centro Oeste – are operating at maximum capacity, transporting the fuel out of the non-conventional field, the majority of which lies in the southwestern province of Neuquen.

The Energy Ministry called on Wednesday for bids on the design and construction of a fourth pipeline, which will save the country an estimated $240 million annually on imports of liquefied natural gas (LNG).

Demand for LNG has been growing in Argentina and the existing infrastructure is unable to meet it, the ministry said.

The government expects construction of the first phase of the pipeline, which will have a capacity of 15 million cubic meters per day, to be completed in the winter of 2021.

As demand for natural gas rises, the pipeline will have the capacity to be scaled up in future phases to a capacity of 40 million cubic meters per day.

The pipeline will have a length of about 570 kilometers (354 miles), running from close to the Tratayen plant in Neuquen to the Saturno compression plant outside Salliquelo, a city in Buenos Aires province.

Bids are due on September 12, the Energy Ministry said.

The second phase of the project, according to the government, will run 470 kilometers (292 miles) to just outside San Nicolas, a city in Buenos Aires province.

Vaca Muerta’s production rose on a sustained basis in the past two years, the government said.

About 30 companies currently have concessions in Vaca Muerta, with YPF, now controlled by the Argentine state, holding the largest number.