Argentina’s LNG Expansion Takes a US$51 Billion Step Forward
Argentina’s plans to build a large-scale LNG export industry have moved into a new stage, with the Argentina LNG project applying for inclusion in the country’s Large Investment Incentive Regime (RIGI) as its project partners advance plans for a potential final investment decision later this year.
The development, led by state-controlled YPF with Italy’s Eni and XRG, the international investment arm of Abu Dhabi National Oil Company (ADNOC), represents a projected US$51 billion investment over the life of the project, according to YPF. The company describes it as the largest private investment proposed in Argentina and the largest project submitted under RIGI to date.
The project is designed to connect Argentina’s Vaca Muerta gas resources in Neuquén with LNG export infrastructure on the Atlantic coast of Río Negro, creating an integrated chain from upstream production to international markets.
A major infrastructure build-out
The investment required by the initial development is expected to reach approximately US$29 billion by 2031, the targeted start-up date for the first LNG facilities.
Around US$24 billion of that amount is planned for infrastructure, including industrial facilities, dedicated gas transportation and port infrastructure. A further US$5 billion is expected to be directed towards upstream development and drilling.
The project will include gas production in Neuquén, transportation infrastructure, processing facilities and liquids-fractionation trains before the gas reaches the liquefaction units offshore Río Negro. YPF’s project plan calls for two floating LNG units with combined capacity of 12 million tonnes per annum (mtpa).
From Vaca Muerta to LNG exports
The development is intended to give Argentina a new route to monetise its substantial unconventional gas resources.
Vaca Muerta is the upstream foundation of the project, with production in Neuquén supplying the gas required for the planned LNG facilities. The export component will be located offshore in the Gulf of San Matías, linking the country’s major shale-gas resource with international LNG markets.
YPF’s project materials indicate that the development has the potential to reach 18 mtpa of LNG capacity as it expands beyond the initial two-unit configuration.
For Argentina, the significance extends beyond the LNG facilities themselves. Increasing gas production and export capacity would create an additional source of foreign-exchange earnings while opening a larger international market for Vaca Muerta output.
RIGI provides the investment framework
The application for RIGI is intended to establish a more predictable regulatory and financial framework for a project requiring substantial upfront capital and long-term international financing.
The regime provides qualifying large-scale investments with stability covering areas including taxation, customs, foreign exchange and legal conditions. YPF has said those provisions are important to attracting the international investment and financing needed for Argentina LNG.
The application is therefore an important development milestone, but it does not represent a final commitment of the full US$51 billion. The project still has to progress through its technical, commercial and financing stages before construction can proceed at full scale.
International partnership
The project’s international structure has developed over several stages. YPF and Eni initially advanced Argentina LNG before XRG joined the development. The three companies signed a Joint Development Agreement in February 2026, while subsequent agreements have expanded the partnership’s role in the upstream segment.
The combination of Argentina’s gas resources with the international experience and investment capabilities of Eni and XRG is intended to support the project’s development and eventual access to global LNG markets.
Export and employment potential
The project partners estimate that Argentina LNG could generate approximately US$10 billion in annual export revenues over two decades once operational.
Construction is also expected to create significant demand for workers and local suppliers. Project estimates indicate that construction activity could generate around 20,000 jobs annually between 2026 and 2030, with employment potentially reaching 40,000 at the peak of the build-out.
The opportunities would extend across drilling, engineering, pipeline construction, processing, port services, logistics and other parts of the energy supply chain.
FID remains the next major milestone
The project partners are targeting a final investment decision in the second half of 2026, with the first two FLNG units planned to begin operations in 2031.
The period ahead will be critical as the project moves from regulatory approval and development planning towards financing and execution. Its progress will also provide an important test of Argentina’s ability to convert Vaca Muerta’s resource base into large-scale export infrastructure.
If completed as planned, Argentina LNG would establish a new connection between the country’s unconventional gas production in Neuquén and global LNG markets, while positioning LNG exports as a potentially significant new component of Argentina’s energy economy.
