Argentina wants to become a new LNG supplier

Argentina's $51 Billion LNG Bet: XRG, Eni and YPF Move to Unlock Vaca Muerta

Argentina is moving to turn Vaca Muerta, its flagship shale basin, into a global LNG export hub, and Abu Dhabi's XRG is one of the partners behind it.

The integrated Argentina LNG project, developed by XRG alongside Argentina's YPF and Italy's Eni, targets 12 million tonnes per year of capacity through two floating liquefaction units of 6 mtpa each, located offshore Río Negro. Total investment is estimated at $51 billion, with $29 billion planned through start-up, targeted for 2031.

The partnership has advanced in stages. In February 2026, the three companies signed a binding Joint Development Agreement, formally bringing XRG into the project. In June, XRG and Eni each agreed to acquire a 32% stake in three upstream Vaca Muerta gas blocks dedicated to the project, with YPF retaining 36%. The acquisitions remain subject to regulatory approvals, and the partners are working toward a final investment decision.

For Argentina, the stakes are high. Turning Vaca Muerta's gas into exports is central to the government's strategy to strengthen the economy and rebuild foreign-currency reserves. YPF projects the project could generate around $10 billion in annual export revenue over two decades. The project is also expected to support more than 40,000 jobs.

For global markets, Argentina LNG adds a new source of supply at a time when buyers are looking to diversify. A new supplier in the Southern Hemisphere strengthens long-term energy security for importing nations and gives the market more flexibility.

For XRG, the investment reflects its confidence in Argentina's world-class resources and its ambition to build an international gas and LNG portfolio. With YPF's experience in Vaca Muerta and Eni's track record in floating LNG, the consortium is positioned to make Argentina a competitive new player in global LNG.