Investments
Pan American Energy (PAE), the oil producer controlled by the Bulgheroni family and a partner of BP, kicked off the year with the first international corporate bond issuance of 2026, placing $375 million in notes in New York at a 7.75% rate. The deal exceeded expectations and reflects renewed investor confidence in Argentina’s energy sector.
According to Shale24, the proceeds will be used to support the company’s aggressive investment plan in Argentina, with a focus on shale development and the liquefied natural gas (LNG) project, as well as to refinance existing liabilities. The bond, with an implied 11-year maturity and principal repayments in three annual installments starting in year nine, drew strong demand, allowing the company to price in the middle of the initial book range of $300 million to $500 million.
Financial analysis: A competitive rate amid higher leverage
The 7.75% rate achieved was better than several analysts had projected. Mariva’s research team, for example, had expected a coupon higher than the 7.75% secured by Pampa Energía in its $450 million, 12-year issuance, but lower than the 8.125% paid by Pluspetrol on its $500 million, six-year bond.
The key to the attractive pricing lies in PAE’s credit profile, despite rising leverage. Net debt to EBITDA reached 4 times in the third quarter of 2025, up from 3.8 times in the second quarter and 2.9 times a year earlier. The increase reflects the strong pace of investment during an expansionary cycle, offset by solid EBITDA generation.
Another perspective also supports the deal. Toward the end of 2025, brokerage firm Facimex Valores noted in a report that PAE delivered “a notably strong period in profitability despite weak sales, thanks to sharp cost compression that boosted EBITDA.”
The firm highlighted the transition toward unconventional projects and an investment strategy that, while increasing leverage, positions the company to capture growth in Vaca Muerta under tighter financial conditions.
The issuance is part of a broader wave of renewed access to international markets that followed Argentina’s 2025 midterm elections, with previous deals by Tecpetrol, Pampa Energía, TGS and Pluspetrol. PAE’s success confirms that international investors see value in Argentine oil and gas companies with exposure to shale and LNG.
Operating profile and growth drivers
As of November 2025, PAE ranked as Argentina’s second-largest oil producer, with output of 99,700 barrels per day, and the second-largest natural gas producer, at 15.1 million cubic meters per day. It maintains leadership in conventional production at the Cerro Dragón field in Chubut province, while accelerating its shift toward unconventional resources. The company has secured shale concessions at that field and added Continental Resources, led by U.S. shale pioneer Harold Hamm, as a partner in key blocks in the Neuquén and Río Negro provinces.
The main long-term catalyst is the LNG project. PAE holds a 30% stake in Southern Energy, a consortium set to invest $6.878 billion, approved under Argentina’s large investment incentive regime known as RIGI, to export 5.9 million metric tons per year using two floating LNG vessels in the San Matías Gulf, off the coast of Río Negro. The partners include state-run YPF with 25%, Pampa Energía with 20%, Harbour Energy with 15% and Golar LNG with 10%. The first vessel is scheduled to arrive in 2027, and PAE has committed $459 million over the first two years.
With this transaction, PAE not only refinances at competitive rates but also secures liquidity for an investment cycle expected to lift production and generate foreign currency inflows for Argentina. The start of 2026 sends a clear message: Argentina’s energy sector is back in global capital markets, and it intends to stay.