Argentina’s Shale Patch to Boost Oil Exports with Supertankers

Supertankers could begin docking in Argentina to load oil from the country’s shale patch after a pipeline is set to connect the Vaca Muerta shale play with a terminal at Punta Colorada port capable of handling the so-called very large crude carriers (VLCCs). 

Earlier this year, Argentina’s state-run energy giant YPF began construction of the first section of a 600-kilometer (373 miles) pipeline designed to connect the Vaca Muerta oil production with the Argentinian coast, Oil & Gas Journal reported in May. Phase two of the $2.5-billion pipeline project will include the export terminal in the Punta Colorada area, which will have the depth and capacity to handle the loading of the supertankers, each of which is capable of carrying up to 2 million barrels of crude. 

As the loading terminal will be equipped with two single point moorings designed to accommodate VLCCs, Argentina should expect to enter the supertanker market this decade, Gibson Shipbrokers said in its weekly report on the tanker market.  

Argentina is raising crude oil production, and this increase has largely gone under the radar, but the South American producer “is unlikely to challenge the big crude exporters in the same way the US has done following its own shale revolution,” Gibson said. 

Argentinian crude shipments have been holding steadily above 100,000 barrels per day (bpd) over the past two and a half years, mostly loaded on Aframax, Panamax, and Suezmax tankers to the U.S. and Brazil, according to Gibson. 

Over the past six months, loadings on Aframaxes have surged and boosted the share of Aframax vessels from just 4% in 2023 to almost 30% so far this year, the ship broker said. 

“Further changes are likely, with VLCCs gaining market share once the Punta Colorada pipeline commences its operations,” Gibson noted. 

Argentina is also moving a step closer to start exporting LNG and monetizing its huge resource in the Vaca Muerta after maritime LNG infrastructure firm Golar LNG signed a 20-year deal with Pan American Energy (PAE) for the deployment of a Floating Liquefied Natural Gas (FLNG) vessel in Argentina.   

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com