YPF, ENAP Boost Gas Production From Argentina's PIAM Project
Zacks Investment Research | Apr 05, 2018 11:11PM ET
YPF Sociedad Anonima (NYSE:YPF) of Argentina along with ENAP of Chile recently announced their intention of increasing the production of natural gas, offshore South America. The project is worth $354 million.
ENAP is the operator of the Incremental Project Magallanes Area (PIAM), which will ramp up gas production from the existing 2.4 million cubic meters per day to 4 million cubic meters. The project will also boost petroleum production by around 25%. The state-run energy companies engaged five oil platforms in the project, which are located in Argentina’s Santa Cruz province near the Strait of Magellan.
The investment plan was carried out for one and a half years, the peak which created more than 1,000 jobs. Laying new pipelines and modifications of the existing infrastructure were part of the investment plan. To treat the additional natural gas, a new plant with compressors of 9,000 horse power was built by the partnership.
The project is expected to directly address the Argentine demand for gas that increased rapidly since 2014. The production shortage of natural gas started increasing in the country before 2010, forcing more imports from neighbor countries like Bolivia. The project, thus, is in line with President Mauricio Macri’s plan to eliminate dependency on gas imports by 2020-21, which primarily banks on the country’s Vaca Muerta shale.
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