Argentine oil pipeline operator Oleoductos del Valle (Oldelval) is planning to invest $750m to expand the pipeline capacity from the Vaca Muerta shale reserve in Neuquen province, reported Reuters citing Argentina Energy Ministry.
The investment would increase Oldelval’s capacity from 36,000 cubic meters to 72,000 per day in two years.
The proposed project will involve construction of an additional 525km of pipes and is expected to create 1,200 jobs.
The latest move by Oldelval comes close on the heels of approval from the government for a ten-year extension until 2037 to operate pipelines from the Neuquen basin to Vaca Muerta.
As per the energy ministry estimates, the project could boost the South American country’s total oil exports capacity to 250,000 barrels per day.
Oldelval CEO Ricardo Hosel was quoted by the news agency as saying: “This project will allow us to double our transport capacity and allow the country to generate between $4 billion and $6.5 billion.”
Argentina Energy Secretary Flavia Royon said: “This is a very important investment by the company and a great opportunity to increase crude exports.”
To help address a significant energy trade deficit, Argentina is looking to boost energy exports supported by the Vaca Muerta shale formation, which is claimed to be world’s second-largest reserve of shale gas reserve.
Furthermore, the government plans to build gas pipeline to link the Vaca Muerta reserves with the Buenos Aires, in the coming weeks.