The international held virtual event, “Insights for defining Latin America’s regional energy agenda for a Post-Covid-19 era”, supported by the International Energy Agency and La Organización Latinoamericana de Energía highlighted the importance of Argentina’s shale gas reserves in Vaca Muerta. Currently, despite possessing the favourable geology of the United States, just four percent of the Vaca Muerta’s shale gas reserves have been commercially developed.
This fact alone underpins the claim by Argentina’s Dr. Javier Papa, undersecretary of energy planning, that Argentina’s shale reserves will play an important role in the country’s post-Covid energy strategy. Dr Papa, as reported in the October edition of Natural Gas Intelligence, states that shale gas will be a “ key part of the energy transition “ and boost gas which already provides 58 percent of the country’s total energy needs.
Unfortunately, Argentina’s past domestic energy policy has suppressed potential investor interest in the Vaca Muerta and there remain market obstacles including the current freeze on utility rates and bans on cutting off non- paying electricity and gas customers . However, to encourage future exploration and development, the government has implemented a $45 a barrel price floor and the secretariat is in the process of developing a new gas plan.