TotalEnergies: Vaca Muerta Gas Needs Low Price to Beat Brazil LNG

TotalEnergies said Argentine gas must reach Brazil at below $10/MMBtu to stay competitive, citing infrastructure challenges and the need for lower tariffs to unlock Vaca Muerta’s export potential.

(Reuters) — TotalEnergies said Argentine natural gas must reach Brazil at a cost below $10 per million British thermal units (MMBtu) to remain competitive, Sergio Mengoni, the company's Argentina country chair, said on Sept. 8.

Why It's Important

Argentina's Vaca Muerta shale holds significant export potential, but infrastructure gaps and pricing could hinder competition with liquefied natural gas imports to Brazil.

Key Quote

"We need infrastructure first – for Vaca Muerta gas to reach the north and be used for exports – and then for transportation tariffs in countries where the pipeline has been amortized to drop a bit," Mengoni, head of TotalEnergies Argentina, said during the Argentina Oil & Gas event in Buenos Aires.

By The Numbers

In April, TotalEnergies carried out a pilot test, exporting 500,000 cubic meters of gas per day from Vaca Muerta to Brazil's Matrix Energía for 10 days through a Bolivian pipeline.

Mengoni said the final price needs to stay below $10/MMBtu to remain competitive in Brazil.