Pan American Energy (PAE) will substantially increase its oil and gas production in 2026, the company told BNamericas. The growth stems from annual investments of US$1.6 billion that the company has been making, on average, in Argentina.
In terms of oil, PAE expects to add, this year, approximately 30,000 barrels per day, which will make it possible to reach a total production close to 130,000boe/d (barrels of oil equivalent per day).
In gas, the oil and gas firm is expanding Aguada Pichana Oeste, one of the main gas hubs of Vaca Muerta. In April, production will increase from 12 million cubic meters per day (Mm³/d) to 16Mm³/d, and the expectation is to reach between 24Mm³/d and 28Mm³/d by 2028, preparing the volumes required for the development of Argentine LNG.
“Our main focus is on developing the gas and oil of the Neuquén basin, in the Vaca Muerta formation, which is one of the main unconventional resources in the world,” said the company’s managing director in Brazil, Alejandro Dupuy, in an interview that will be published in full on Friday (March 20).
“The goal is to increase production to meet Argentine domestic demand and also to advance the monetization of these resources through regional and global exports,” the executive added.
The growth in production is also supported by strategic international alliances. Recently, PAE signed an agreement with Continental Resources, one of the pioneers of shale in the United States, through which the company acquired 20% of the Argentine company’s stake in four shale oil areas. PAE will remain the majority partner and operator in all the blocks.
LNG export
In parallel, PAE is moving forward with the LNG export project of Southern Energy (SESA), a consortium led by the company together with YPF, Pampa Energía, Harbour Energy and Golar. The project calls for the installation of two liquefaction vessels in the San Matías Gulf: the Hilli Episeyo, scheduled to begin operations in 2027, and the MKII, planned for 2028. Together, they will have an LNG production capacity of six million tons per year.
The consortium has already signed a contract with the German company SEFE (Securing Energy for Europe) to sell two million tons per year of LNG for eight years, the largest Argentine LNG export agreement in terms of volume and duration. Produced in Aguada Pichana Oeste, the committed volume represents more than 80% of the Hilli Episeyo’s capacity and more than 30% of the combined capacity of the two vessels.
The infrastructure works are already underway. Work has begun on the 15km onshore gas pipeline with a diameter of 30 inches, which will connect to the San Martín Gas Pipeline. Soon, the installation of two 6km offshore gas pipelines will begin, with diameters of 20 and 24 inches, which will connect the coast to the liquefaction vessels.
In addition, a dedicated gas pipeline is in the bidding process, which should be operational in 2028, when the second vessel, the MKII, comes into operation. This gas pipeline will be financed with capital contributions from the project partners and through international financing.
The project envisages an estimated investment of US$15 billion over 20 years of operation and generation of exports exceeding US$20 billion between 2027 and 2035.
(The original version of this content was written in Portuguese)