Argentina LNG project moves into FEED phase

A drone view shows a shale gas flare in the Vaca Muerta formation, outside the Patagonian oil and gas town Anelo, Argentina. YPF, Eni and XRG have signed a binding Joint Development Agreement (JDA) to advance the proposed Argentina LNG project, a large-scale integrated gas and liquefaction development designed to monetize shale gas from the Vaca Muerta basin and position Argentina as a long-term LNG exporter. (Image: Reuters)

YPF, Eni and XRG have signed a binding Joint Development Agreement (JDA) to advance the proposed Argentina LNG project, a large-scale integrated gas and liquefaction development designed to monetize shale gas from the Vaca Muerta basin and position Argentina as a long-term LNG exporter.

The partners said the agreement establishes the work plan for the next development stage and is intended to move the project toward a final investment decision in the second half of 2026.

Argentina LNG is planned as a 12 million tons per annum (mtpa) export project based on two floating LNG facilities, each with capacity of 6 mtpa. The overall development scope includes upstream gas production, processing, transportation and LNG export infrastructure.

Under the JDA, the three companies will launch front-end engineering design and related activities, including detailed engineering, technical structuring and commercial and financing workstreams. The structure is intended to align upstream supply, midstream transport and floating liquefaction into a single integrated export chain.

Project partners expand

The agreement also formally brings XRG into the project partnership alongside YPF and Eni. XRG is the international investment arm of ADNOC and has been building a global portfolio across energy and chemicals assets.

Horacio Marín, president and CEO of YPF, said the expanded partnership strengthens the project’s global positioning and technical depth.

“This new step marks the formal inclusion of XRG into the project we have been developing together with Eni,” Marín said. “These two world-class players allow us to position Argentina LNG as one of the leading LNG projects globally. We will now continue working very intensively to reach FID during the second half of 2026.”

Eni executives characterized the project as one of the more promising new LNG opportunities tied to unconventional gas resources.

Guido Brusco, Eni chief operating officer of global natural resources, said the addition of XRG broadens the project’s strategic and financial base while FEED work advances technical definition.

“With the Joint Development Agreement a new partner — XRG — joins Argentina LNG, which is emerging as one of the most promising opportunities in the global gas landscape,” Brusco said. “This project is taking shape in a way that reflects both technological leadership and strategic vision.”

Floating LNG focus

The planned use of floating LNG (FLNG) units suggests a phased and potentially faster-to-market export strategy compared with large onshore liquefaction terminals. Floating facilities can reduce the need for extensive onshore construction while enabling offshore or nearshore liquefaction tied to pipeline-fed gas supplies.

For Argentina, the development represents a major step toward converting Vaca Muerta shale resources into exportable LNG volumes. The basin has attracted growing upstream investment in recent years, but large-scale gas export infrastructure has remained a gating factor for full commercialization.

Mohamed Al Aryani, president of international gas at XRG, said the project aligns with the company’s strategy to invest in large-scale gas developments that support global supply diversity.

“Argentina LNG’s potential is significant, and this agreement marks an important milestone in the project’s development,” he said. “YPF, Eni and XRG share the ambition to progress a large-scale LNG project that supports reliable, flexible energy supply to international markets while creating long-term value for partners and local communities.”

Broader export ambitions

YPF said the LNG development is part of a broader strategy to transform Argentina into a sustained energy exporter, alongside crude oil infrastructure expansions linked to Vaca Muerta production growth. The company is already active across the value chain, including upstream production, transportation, refining and fuel marketing.

If completed as planned, the 12 mtpa Argentina LNG project would place the country among a new tier of LNG-exporting nations and add fresh Atlantic Basin supply to global markets later in the decade. For equipment suppliers and midstream contractors, the FEED phase is expected to define liquefaction technology choices, rotating equipment scope and gas treatment and compression requirements tied to floating LNG operations.