ExxonMobil has launched a tender for a $75 million project to build a massive oil pipeline in Argentina to increase oil production in the Vaca Muerta shale play, the company’s spokesperson reported on Wednesday, November 8, 2023.

According to the report, the new pipeline will stretch 43 kilometres from Bajo del Choique-La Invernada, ExxonMobil's largest development in Vaca Muerta, to a connection with a backbone system for moving crude to the Atlantic. 

The pipeline is anticipated to move between 8,000 and 12,000 barrels per day (b/d) of crude, with the potential to increase capacity to up to 60,000 b/d when completed. Meanwhile, ExxonMobil will be accepting bids until the end of November, with the aim of building the pipeline in the first half of 2024.

The company expects to start moving supplies by the end of that year, with the goal of the project being to use the pipeline instead of trucks to move crude out of the block, enabling the company to boost production, according to a company spokesman.

Bajo del Choique is currently producing some 7,600 b/d, according to data from the Argentina Oil and Gas Institute, which could see a tremendous boost when the new pipeline materializes. ExxonMobil operates three other blocks in the same area for the newly planned pipeline's origin point, which are currently producing below their expected full potential.

In 2019, ExxonMobil announced plans to drill 90 wells to increase shale oil and gas production to 55,000 b/d of oil equivalent in Bajo del Choique-La Invernada by 2024. The company said that if the development is successful, it could take production to 75,000 barrels of oil equivalent per day (boe/d) in a second phase.

With Vaca Muerta driving Argentina's oil production growth, the government of Neuquén, home to most of the in-production fields in the play, has forecast that the province's production could reach 400,000 b/d early next year, up from 308,000 b/d at the end of 2022, before climbing to 1 million b/d by 2027 or 2028.