Tecpetrol projects producing at least 135,000 to 140,000 barrels per day (bbl/d) of oil in Argentina, and 30 to 35 million cubic meters per day (MMm³/d) of gas, within five years. The target was set out by its CEO, Ricardo Markous, at the eighth Fórum Nacional de Energía, which LIDE Argentina held on Thursday, November 5 at the Alvear Icon Hotel in Buenos Aires.
“I picture Tecpetrol producing at least between 135,000 and 140,000 barrels of oil per day in Argentina and some 30 or 35 million cubic meters of gas per day within five years,” said Markous, who heads the Techint Group’s exploration and production subsidiary. According to the CEO, the company is starting from about 20,000 bbl/d. The figure exceeds the target of about 130,000 bbl/d by 2030–2032 that the executive had outlined at AOG Patagonia 2026, the regional oil and gas exhibition.
Los Toldos II Este Will Add 70,000 bbl/d With Two Modules in 2027
The engine of that leap is Los Toldos II Este, the shale oil block near Rincón de los Sauces, in northern Neuquén province, within the Vaca Muerta formation, one of the world’s largest shale plays. The project entered the RIGI with a $6.4 billion investment over its life; the RIGI is Argentina’s Large Investment Incentive Regime. Tecpetrol is developing two modules of 35,000 bbl/d each. The first will start producing in early March 2027, and the second will take the block to 70,000 bbl/d by mid-year.
With that volume and the rest of its blocks, Tecpetrol would go from 20,000 to between 90,000 and 100,000 bbl/d. The 70,000 bbl/d from Los Toldos II Este is equivalent to about 10% of the 700,000 bbl/d that, according to Markous, unconventional production currently contributes in Argentina.
The project’s scale reflects a cost decision. “We are aiming for a large-scale development model with low operating costs. Instead of moving ahead with early production facilities (Early Production Facilities), we are going straight to a production scheme,” the CEO explained.
Drilling follows the same approach, in a block where Tecpetrol coordinates hundreds of domestic suppliers in factory mode, a high-cadence, manufacturing-style development approach. “Today, at Los Toldos, we are drilling 3,500-meter wells and, in some cases, it takes us 14 to 15 days. In other words, we doubled the length and cut execution time in half. As for fracs, we are reaching an average of 10 per day,” he said.
A Vaca Muerta Well Can Recover Twice as Much Oil as a Permian Well, Markous Says
Asked whether Argentina can compete with the Permian Basin, the main U.S. shale oil basin, Markous said it can. “We are blessed to have in Vaca Muerta a spectacular rock that delivers a great oil yield,” he said.
“If we take a 3,000-meter well as a reference, the cumulative EUR, the estimated ultimate recovery, can reach one million barrels. By contrast, an average well of the same length in the Permian accumulates around 500,000 barrels,” he said.
The gap in scale remains large: according to the CEO, the Permian produces about 6.7 million bbl/d. “We are always going to have a higher production cost in Argentina because of scale and also because of financing, which costs less in the United States. However, productivity offsets those differences. That is why I believe we are competitive,” he said.
That competitiveness will be measured against a cheaper barrel. Markous noted that the futures market puts Brent at around $70 per barrel toward late 2029 or early 2030, a scenario he had already outlined at the IDEA Colloquium, Argentina’s annual business conference. “We will always have to look at the United States, because we compete with that market,” he said.
The cost of capital is the other variable. In September, Tecpetrol placed $450 million of additional Class 10 corporate bonds due 2033 at a yield of 7.25%. According to Markous, if the company went to market today, that rate would be above 9.25%. “We live in a world where rates are rising and the oil price is subject to uncertainty. We have to be prepared and be very competitive for what lies ahead,” he said.
Tecpetrol Studies the LNG Business as Argentina Resumes Gas Exports to Chile
Asked whether the company could develop its own liquefied natural gas (LNG) project, Markous confirmed that it is assessing options. “We are studying it. Clearly, we can be gas brokers,” he said.
The company’s gas experience comes from Fortín de Piedra, the unconventional field Tecpetrol has been developing since 2017. In winter, it reaches peaks of close to 25 MMm³/d. Markous acknowledged that the growth of gas associated with oil increases competition among producers: “What is a disadvantage for us as a company is an advantage for the country, for the industry and for power generation.”
For the CEO, Argentina has what it takes to become a reliable energy supplier for the region and the world, thanks to the quality of its rock and its geopolitical position in light of the wars in Ukraine and Iran. “We are already exporting gas to Chile again. We are not going to reach the volumes recorded in the past, because Chile also transformed itself on the back of Argentine gas and moved toward renewable energy. But we are exporting,” he said.
The first module of Los Toldos II Este, with 35,000 bbl/d, is scheduled to start producing in early March 2027.