Southern Energy will receive the first pipe for its dedicated export gas line in August, CEO Rodolfo Freyre said, dating the start of construction. Freyre, speaking on June 17 at the Shale24-Santander Energy Summit, used the milestone to lay out the engineering that still separates the project from Argentina's first LNG export cargo, to be shipped from Punta Colorada in Río Negro province.
Southern Energy groups five shareholders: Pan American Energy (PAE), Argentina's largest private oil producer; YPF, the state-controlled oil and gas company; Pampa Energía, a diversified Argentine energy company; Harbour Energy, the U.K.-based exploration and production company; and Golar LNG, the Norway-based LNG infrastructure company.
Together they are building the country's first large-scale LNG export venture, with about 6 million tonnes per annum (MTPA) of capacity from two floating LNG units (FLNGs).
The first link in that chain is the mooring system. Freyre described it as a high-complexity structure, currently under construction in Europe, that anchors at 40 meters depth and requires a specialized vessel to install. The large structures carry their own logistics and customs challenges, both for importing the equipment and for exporting the product once operations begin.
Each vessel will house about 80 people for 28 days, on a 28-day-on, 28-day-off rotation. Sustaining that operation requires a supply chain that does not yet exist at the Río Negro port. The company is building a logistics base to provision crew rotations, food and spare parts, along with the tugboats that will assist tankers arriving to load. Crew boats will sail close to two and a half hours from San Antonio Oeste to the floating unit, depending on wind and tide.
In parallel, the operator is working with the province to build local technical capacity. The vessel will arrive initially with a foreign crew, and the goal over time is for most of those operating the units to be Argentine, through a training scheme with technical schools in Río Negro.
Timeline: Under 340 Days and a Dedicated Pipeline
Execution is running against the clock. Freyre recalled that the project began with a first video call to a Golar LNG agent in October 2023, and cited a figure: delivery must be completed in under 340 days. The Hilli Episeyo, the FLNG that will anchor the project, is finishing its final month of contract in Cameroon, will stop in Singapore for refit and then sail to Argentina, a transit of close to a year.
The pipeline introduced the biggest capital demand. The project was first conceived as seasonal, with a single vessel connected to the existing transport system, then shifted to a two-vessel scheme that required a dedicated line. To finance it, the operator created San Matías Pipeline, with the same shareholders as Southern Energy, and structured a project finance package with Santander among the banks.
Freyre stressed that the financing was designed to preserve commercial flexibility with customers despite that structure. The first pipe arrives from August to begin construction of the route, he said.
The line linking Tratayén with the Golfo San Matías will run 471 kilometers, with a 36-inch diameter and an initial capacity of 27 million cubic meters per day (MMm³/d), at an investment of $1.3 billion. The welded pipe was awarded to Welspun, the Indian pipe manufacturer, in a decision that left out the Techint Group despite a request from its seamless-pipe subsidiary Tenaris to match the best offer.
Civil works are in the hands of a joint venture of Víctor Contreras of Argentina and Sicim of Italy, the latter making its Argentine debut. The compressor plant at kilometer 80 went to Oilfield Production Services, with three NovaLT16 turbines from Baker Hughes, the U.S. oilfield services company.
RIGI and Corporate Structure
The pipeline's entry into Argentina's Large Investment Incentive Regime (RIGI) has already been approved by the Investment Committee. San Matías Pipeline's ownership mirrors Southern Energy: PAE (30%), YPF (25%), Pampa Energía (20%), Harbour Energy (15%) and Golar LNG (10%).
The project now holds two prior RIGI resolutions, one per vessel, and firm 30-year export permits — a point Freyre flagged as decisive, given it is the first Argentine LNG export project. Total capacity runs to about 6 million tonnes a year; the first contract, a binding sale and purchase agreement (SPA) with SEFE Securing Energy for Europe, committed 2 MTPA over eight years, leaving 4 MTPA to be marketed. Each of these definitions, he said, sets part of the path for the larger-scale Argentina LNG project that YPF chairman and CEO Horacio Marín is leading.