YPF, Eni, XRG sign deal to advance Argentina LNG export project

YPF, Eni and XRG signed a binding joint development agreement to move forward on Argentina LNG, a project to export 12 million metric tons/year of liquefied natural gas from Argentina's Vaca Muerta shale play to the global market, the companies said Feb. 12.

The accord is another step toward signing a final investment decision for the project sometime later this year, said a source at YPF, Argentina's state-run gas producer that is spearheading the plan.

The three partners plan to install two floating regasification facilities, each with 6 million mt/year of capacity, they said in a joint statement.

As part of the project, the companies will work together on the production of the gas, its processing, transport and export, they added.

The next phase is to start with the front-end engineering design and related activities, including engineering, technical structuring and key commercial and financing work-streams.

Horacio Marín, YPF's chairman and CEO, said this latest agreement formally brings United Arab Emirates-based XRG into the Argentina LNG project with his company and Italy-based Eni.

"These two world-class players allow us to position Argentina LNG as one of the leading LNG projects globally," Marín said. "We will now continue working very intensively to reach FID during the second half of 2026."

YPF and Eni signed an initial agreement in April 2025 for the project, part of a multipartner effort to build capacity to export 30 million mt/year of LNG from Vaca Muerta by 2031 with an investment of some $25 billion. The gas will be fed to six FLNGs in the deepwater San Matías Gulf in Río Negro province due east of Vaca Muerta, with the first shipments slated to start in 2027.

Guido Brusco, Eni's chief operating officer for global natural resources, said Argentina LNG, as the entire project is called, "is emerging as one of the most promising opportunities in the global gas landscape."

Mohamed Al Aryani, president of international gas at XRG, said that the project will support the provision of "reliable, flexible energy supply to international markets."

Gas production

Ahead of this development agreement, YPF swapped several blocks in Vaca Muerta with fellow producer Pluspetrol, gaining more assets in the play's wet gas window from where it will source the supplies for LNG exports.

Marín has said that sourcing the LNG from the wet gas window boosts the potential sales growth, given that gas can be exported as well as oil and liquids.

Finding more partners

The development of Argentina LNG, which has been in the plans for several years, has not been straightforward. The first stage of the three-pronged project for 6 million mt/year of capacity is moving forward the fastest, led by BP-backed Pan American Energy.

But in December 2025, UK-based Shell pulled out of one of the first stages to build an initial 10 million mt/year of LNG export capacity in Argentina, meaning that YPF likely will search for another partner to bring on board.

The gas will initially come from conventional and shale fields via existing pipelines, but new dedicated pipelines will be built as part of Argentina LNG to source all gas from Vaca Muerta, one of the world's largest shale plays. The play is expected to drive the country's gas production to 250 million cubic meters/day in 2030 from 140 million cubic meter/d in 2025, according to most estimates. Vaca Muerta was producing 73 million cubic meter/d in December, according to Energy Secretariat data.