Adnoc’s International investment arm XRG, Argentina’s YPF, and Italy’s Eni will start front-end engineering design and related work for an Argentina LNG project under a joint development agreement, according to a statement from Eni. The move steps up the non-binding agreement inked back in November to explore joining the venture.

The total financing needed for the project is pegged at USD 12.5 bn, according to Reuters ’ earlier reporting. The next milestone is lining up offtake and financing, clearing the path for a final investment decision.

The plan: The project is set to export gas from the Vaca Muerta formation, the world’s second-largest unconventional natural gas reserve, through a pipeline, and will involve the installation of liquefaction units. The initial phase of the project is expected to deliver 12 mn tonnes per annum (mtpa) of LNG production capacity through two 6 mtpa FLNG vessels.

Could we see another Latin American move? Bloomberg previously reported that Adnoc is considering a potential entry — via XRG — into Venezuela’s oil market through a partnership with another international energy firm, though any move would depend on clear regulatory and financial structures for investments in the country and coordination with the US.

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