A colossal geological formation located in Patagonia containing what is considered one of the largest unconventional reserves of gas and oil in the world promises to transform the Argentine economy.
In October, the country surpassed its previous national production record by reaching the mark of 859,500 barrels of crude oil per day, surpassing the record of 847,000 barrels recorded in 1998.
This progress is directly linked to the high productivity of Vaca Muerta, a vast shale area that maintains unconventional production in the Neuquén basin with annual growth of 30%, offsetting the 7% decline recorded in conventional production in the rest of the basins. The area constitutes the world’s second largest reserves of shale gas and the fourth largest of unconventional oil.
According to official data, the reserve currently contributes 60% of the country’s total supply, with more than 515,000 barrels per day. Four years ago, production was 280,000 barrels per day.
Thanks to the reserve, last year Argentina exported more energy than it imported for the first time in 14 years. This movement is one of Javier Milei’s government’s bets to reverse the economic decline experienced in his country for years.
According to the magazine The EconomistArgentina is expected to overtake Colombia this year, which produced almost 800,000 barrels per day, as the third largest producer of crude oil in South America. Leading the way are Venezuela, which faces a blockade of its oil-related operations (the country produces almost 1 million barrels per day), and Brazil, which produces more than 3 million.
Still, according to the publication, estimates suggest that the shale business could help create between a quarter and half a million jobs by the early 2030s.
Under the administration of Javier Milei, the region gained new momentum with the relaxation of exchange controls, the removal of regulatory barriers and the granting of long-term tax exemptions.
In November, in a rare understanding between the governments of Milei and Lula (PT), Brazil signed an agreement with Argentina that provides for the import of gas from Vaca Muerta.
The expectation is that the country will purchase up to 30 million cubic meters of gas a day from Argentina by 2030, according to the Minister of Mines and Energy, Alexandre Silveira.
