Argentina’s state-controlled energy company YPF and its partners Italian major Eni and Abu Dhabi’s XRG have filed an application to join Argentina’s Large Investment Incentive Regime (RIGI) for a $51 billion liquefied natural gas project, marking the largest single investment ever submitted to the program.
The Argentina LNG project, announced on August 14, targets the development of the Vaca Muerta shale formation in Neuquen province and the construction of floating liquefaction units off the coast of Rio Negro. The consortium expects a Final Investment Decision (FID) by the end of 2026, with construction projected to run through 2030.
Scale and Strategic Importance
The $51 billion investment commitment surpasses the combined value of the 21 projects already approved under RIGI in its first year and eight months of operation, which totaled $46.7 billion. The project would produce approximately 12 million metric tons per year of LNG, along with significant volumes of ethane, propane, and butane extracted from Vaca Muerta’s wet gas formations.
Vaca Muerta holds roughly 300 trillion cubic feet of recoverable shale gas and 16 billion barrels of recoverable oil, making it the world’s second-largest unconventional natural gas reserve. YPF CEO Horacio Marin has projected the project could generate $10 billion in annual exports for at least two decades and create up to 50,000 direct and indirect jobs.
Under RIGI, approved projects receive a 30-year regulatory framework that provides policy certainty for investors, addressing a key historical concern about Argentina’s investment climate. The regime was introduced by Congress in 2024 as part of the Bases Law.
Financing and Partners
The consortium plans to finance a substantial portion of the construction phase through project finance, where loans are repaid primarily from future project revenues. XRG, the international energy investment arm of Abu Dhabi National Oil Company, acquired a 32% interest in three upstream blocks in the Vaca Muerta basin alongside Eni in February 2026.
Argentina’s Finance Ministry has said it is not yet considering tax increases to fund the project, which is expected to be primarily self-financing. The application will be evaluated by President Javier Milei’s government, which has championed the RIGI program as a tool to attract foreign capital.
Argentina holds approximately 20% of the world’s lithium reserves and has attracted more than $14 billion in mining projects under RIGI, alongside major energy investments. The LNG project would position the country as a significant new source of reliable gas supply to international markets, particularly in Europe and Asia.
Sources: Reuters; Eni press release; Buenos Aires Herald; Oil and Gas Journal
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