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Argentina’s state-owned energy company, YPF, is set to announce a landmark Memorandum of Understanding (MOU) with three major Indian energy firms. This agreement aims to position Argentina as a key Liquefied Natural Gas (LNG) supplier to India while fostering cooperation in lithium development—an essential resource for the global energy transition.
At the heart of this agreement is YPF’s ambitious "Argentina LNG" project, which plans to produce 30 million tonnes per annum (MTPA) of LNG in three stages, each contributing 10 MTPA. One of these stages is expected to supply India, whose rapidly growing economy is projected to be a global powerhouse over the next decade, driving significant energy demand.
“Our main goal is to supply India with LNG while strengthening Argentina’s export capacity. This agreement is a pivotal step in transforming Vaca Muerta’s vast resources into an economic engine for the nation,” said YPF President Horacio Marín during his recent tour of Asia.
Beyond LNG, the deal includes a strategic partnership for developing Argentina’s lithium industry. As India intensifies its decarbonisation efforts, it seeks a secure supply of lithium to support the production of electric vehicles and renewable energy technologies. This builds upon a bilateral agreement signed in 2022 for lithium exploration and extraction in Argentina.
This synergy between gas and lithium underscores Argentina’s critical role in the global energy transition. While LNG addresses near-term energy needs, lithium ensures Argentina’s relevance in a clean energy future.
The agreement with Indian firms, including Oil India Limited and GAIL, adds to YPF’s growing network of international partnerships. Recently, YPF and Shell signed a deal to install two LNG floating liquefaction units in Río Negro, with a combined capacity of 10 MTPA. Shell has committed to purchasing all output from one of the vessels, while the other may serve Indian demand or other emerging markets.
Additionally, YPF is in talks with Golar LNG to add a third vessel with a capacity of 3.5 MTPA, enhancing export opportunities to markets like Germany, Japan, South Korea, and Israel.
Argentina holds the world’s second-largest shale gas reserves and the fourth-largest shale oil reserves, giving it a strategic advantage during the global energy transition. YPF projects that its current initiatives could generate $15 billion annually in LNG exports and another $15 billion from oil by 2031. These figures rival the revenue from Argentina’s agricultural sector in a record year, providing a crucial solution to the country’s longstanding foreign exchange challenges.
The agreement with India not only represents a significant step in YPF’s strategy to establish itself as a leading LNG exporter but also opens doors to new opportunities in lithium’s value chain. With strategic planning and sustained investment, Argentina is well-positioned to maximise Vaca Muerta’s potential and solidify its role as a key player in both traditional and emerging energy markets.
As the world accelerates its energy transition, partnerships like this highlight Argentina’s potential as a reliable supplier of energy and essential resources for a more sustainable future.
