ADNOC’s XRG, Argentina’s YPF and Italy’s Eni have signed a framework agreement to develop a liquefied natural gas project in the Vaca Muerta shale basin, aiming to deliver 12 million tonnes per annum of capacity using floating LNG technology. The agreement marks a notable step toward commercializing Vaca Muerta resources and reflects a broader shift in Argentina’s approach to foreign investment as the government seeks international partners to help stabilize the economy amid fiscal challenges.
The framework agreement formalizes cooperation among the three companies to pursue a large-scale LNG facility that would use floating liquefaction technology. Floating LNG—typically involving vessels or floating platforms where natural gas is cooled and condensed at sea—offers a means to export gas from locations that may lack extensive onshore liquefaction infrastructure. The partners have identified a 12 million tonnes per annum target for the project, a scale that proponents describe as large for LNG developments.
Vaca Muerta is Argentina’s principal shale basin and has been central to the country’s long-term energy plans. The new agreement ties international capital and technical experience to those domestic resources. ADNOC’s XRG, part of the Abu Dhabi National Oil Company group, brings international project development capacity; YPF provides local resource access and operational presence in Argentina; and Eni contributes experience as a global integrated energy company. Together, the companies aim to assemble the technical, commercial and regulatory elements required to advance the scheme.
The transaction also signals a policy tilt in Buenos Aires toward greater engagement with foreign energy companies. In recent years, Argentina has faced fiscal pressures and has pursued measures to attract inward investment intended to boost exports, create jobs and strengthen public finances. The agreement with XRG and Eni aligns with that strategy by seeking external partners able to deploy capital and specialized technology to develop Argentina’s gas resources for export markets.
Under the framework arrangement, the parties will need to follow further steps typical of major energy projects before reaching a final investment decision. Those steps are expected to include detailed engineering and design work, commercial arrangements for gas supply and offtake, regulatory approvals, and the securing of financing and contractors suited to floating LNG construction and operation. The framework sets the stage for these subsequent negotiations and technical studies but does not itself constitute a final investment decision.
If advanced to full development, the project would use gas from Vaca Muerta as feedstock for floating liquefaction units to produce the planned 12 million tonnes per year of LNG. Floating solutions can reduce the need for extensive onshore facilities and can be deployed in a phased manner, which proponents say may help align costs and schedules with market demand. The scale targeted by the partners would represent a significant addition to Argentina’s export capacity if the project proceeds.
The agreement leaves open a number of practical and commercial questions that will be central to the next phase, including detailed timing, financing structures, offtake contracts and the selected floating LNG technology and suppliers. Government engagement and regulatory approvals in Argentina will also be pivotal to moving the project from framework to final investment decision. The signatories’ ability to navigate those steps will determine whether the planned 12 million tonnes per annum capacity becomes an operational export platform from Vaca Muerta.
The agreement leaves open a number of practical and commercial questions that will be central to the next phase, including detailed timing, financing structures, offtake contracts and the selected floating LNG technology and suppliers. Government engagement and regulatory approvals in Argentina will also be pivotal to moving the project from framework to final investment decision. The signatories’ ability to navigate those steps will determine whether the planned 12 million tonnes per annum capacity becomes an operational export platform from Vaca Muerta.