Argentina LNG cleared its second of three regulatory pillars this week as Neuquén province formalized the cession of three feeder blocks from Pluspetrol to YPF.
The provincial approval, instrumented through decrees 0475, 0476 and 0496 of Neuquén's Ministry of Energy, transferred 50% of Pluspetrol, an Argentine independent oil and gas producer, to YPF, Argentina's state-controlled oil and gas company, in the Aguada Villanueva, Meseta Buena Esperanza and Las Tacanas blocks.
The state producer becomes sole titleholder of all three once deed execution is complete. The swap had been agreed at the start of the year as part of a broader asset exchange designed to secure the gas that will feed the floating liquefaction unit YPF is developing in partnership with ENI, the Italian energy company, and XRG, ADNOC's international investment arm.
Whether Argentina LNG moves from regulatory alignment to Final Investment Decision (FID) in the second half of 2026 will depend on factors the published decrees do not resolve, chief among them the pricing methodology for the methane that will feed the train. That variable sits at the center of the third and still-open pillar: a provincial LNG law with a differentiated royalty structure that YPF and Neuquén's executive have been negotiating for three months.
The move closes the second of three regulatory pillars YPF identified as operational preconditions for advancing toward the FID of Argentina LNG, a phased LNG export initiative led by YPF in partnership with ENI and XRG and carrying a $30 billion total investment. The consortium originally aimed for a first-half FID this year, but the horizon has slipped to late 2026. ENI recorded significant progress toward Argentina LNG's FID in its Form 6-K filed with the U.S. Securities and Exchange Commission on February 26.
What closed in February: the RIGI that enables upstream
The first pillar was resolved with Decree 105/2026, published in Argentina's Official Gazette on February 19. The decree extended the window for adhesion to Argentina's Large Investment Incentive Regime (RIGI) by one year, to July 8, 2027, and added to the oil and gas chapter the exploitation and production of new onshore hydrocarbon developments.
The investment floor for those projects was set at $600 million. The same decree reduced the offshore exploration and production threshold from $600 million to $200 million.
A key clause for Argentina LNG's contractual architecture followed in the fine print. Where RIGI-governed activities coexist with non-RIGI activities on the same block, the project vehicle (VPU in the regime's terminology) must guarantee segregation and traceability through independent measurement systems. That requirement forces YPF and its partners to physically separate the production destined for the export train from the rest of the activity on blocks that end up under the new framework.
The regulatory calibration was completed in mid-April with Resolution 484/2026 of the Ministry of Economy, which raised from 30% to 35% the threshold of the financial ratio provided in Article 172 of Law 27,742 for the first three years of each project. The change acknowledges a structural feature of Neuquén's shale: high initial cash generation coexists with a capital commitment sustained over time, as each declining well requires a new one to hold the production plateau, and the 30% threshold did not reflect that dynamic.
What closed this week: the Pluspetrol-YPF swap in Neuquén
The second pillar was closed with the signing of the provincial decrees. The three areas are not homogeneous. Meseta Buena Esperanza (303.71 km²) and Aguada Villanueva (281 km²) are conventional production concessions currently producing. Las Tacanas (411 km²) originated as an Exploration Permit with unconventional objectives for a four-year term and was later classified as a Lot Under Evaluation under provincial regulation.
The package totals 995.71 km² consolidated under single titleholding. The unification of operational control is a precondition for international partners to enter the upstream with legal clarity on gas provenance. The next regulatory step, conversion of the blocks to the Unconventional Hydrocarbon Exploitation Concession (CENCH in Spanish) regime needed to frame the development under the new RIGI, is still pending. The formalization of the cession deeds is the immediate administrative step; the CENCH conversion is the next regulatory stage.
What remains on the table: the LNG law and the methane royalty
The third pillar is the one still open. Neuquén Governor Rolando Figueroa formally announced the dispatch of a provincial LNG-specific law during the March 1 opening of the 55th Ordinary Session Period of the provincial Legislature.
The draft contemplates three axes: a differentiated royalty scheme for methane destined for liquefaction (lower than the 18% Neuquén has applied since 2025 to new unconventional concessions), an exemption from Gross Income Tax on gas before it enters the liquefaction process, and a zero export duty. It also contemplates an infrastructure fund with direct economic impact on Cutral Có and Plaza Huincul, towns adjacent to the three swap blocks.
Bilateral negotiation between Neuquén's provincial executive and YPF has been underway for three months. Figueroa said at the opening of sessions that the agreement was 95% advanced, but that the discussion of the exact royalty percentage applicable to methane remained open.
The sensitive point is how to calculate the reference price of methane destined for export: the provincial executive is working to prevent corporate integration among the consortium companies from fixing artificially low intra-group values that would reduce the royalty tax base.
The methane-specific fiscal design is more than a number: it is the variable that defines the shadow price of the gas feeding the liquefaction train. In the economics of an integrated LNG project, commercialization margin is built on the spread between the cost of gas delivered at the plant and the final cargo price at destination.
The lower the specific royalty taxing methane destined for liquefaction, the lower the effective cost of gas transferred from upstream to the export midstream, and the higher the project vehicle's margin. The technical dispute over the reference price, which Figueroa identified as the last stretch of negotiation, aims to prevent that fiscal optimization from materializing at the expense of provincial revenue.
What is being negotiated is not the magnitude of the tax but the methodology for calculating the taxable base in a chain where buyer, transporter and producer can belong to the same economic group.
The Río Negro layer of the project is already closed. The memorandum of understanding signed in January between YPF and Governor Alberto Weretilneck's government granted 30 years of fiscal and regulatory stability to development of the floating liquefaction units along the provincial coast, complementing the RIGI framework. The national layer is operative. The Neuquén upstream layer has resolved the title change but awaits the law that will set the definitive fiscal cost of the gas going to the liquefaction train.
The FID calendar
The consortium is working against a tight horizon. According to Energy Intelligence coverage following the Joint Development Agreement signed between YPF, ENI and XRG in February, the consortium is targeting a final investment decision in the second half of 2026. The financial structuring, led by JP Morgan, targets a project finance package of unprecedented magnitude in Latin America.
The total investment is estimated at $30 billion ($20 billion for midstream and downstream, $10 billion for upstream), and YPF CEO Horacio Marín said at CERAWeek in Houston, the annual global energy conference organized by S&P Global, that committed financing already equaled 2.4 times the required scale.
The regulatory snapshot at the end of this week shows two conditions resolved — the national RIGI framing and single titleholding of the feeder blocks — and one still on the table, concentrating the project's most sensitive fiscal variable. Closure of that Neuquén piece is what will enable the definitive calculation of the price of the gas that will feed liquefaction, the foundation for all the project finance modeling JP Morgan is structuring with global banks. The final stretch of the FID no longer depends on the full package of conditions: it depends on methane.