Nicolás Arceo for Shale24
Argentina’s associated gas output, natural gas produced as a byproduct of oil extraction, reached a historic high of 26.7 million cubic meters per day (MMm³/d) in January 2026, according to an analysis by Nicolás Arceo, director of the consultancy Economía y Energía.
Throughout 2025, associated gas production rose by about 45% year over year, driven by a surge in shale oil extraction in key areas of Vaca Muerta, Argentina’s flagship unconventional play in the Neuquén Basin. Those blocks are located in the “hot zone” around Añelo, the epicenter of shale development, but also include projects that combine oil and condensate windows, such as La Calera, operated by Pluspetrol in a joint venture with YPF.
Associated gas, which inevitably emerges when producing oil in the black oil and liquids-rich window of the Neuquén formation, is rich in high-value components: ethane, propane, butane and pentanes (natural gas liquids, or NGLs). Unlike dry gas from tight or conventional fields, its marginal cost is low and volumes expand in parallel with the oil boom.
In 2024, associated gas averaged between 12 and 15 MMm³/d and was already becoming a topic of industry debate. The jump in 2025 reflects the acceleration of shale oil activity.
Challenges and business opportunities
The record volumes have created seasonal oversupply. During periods of low demand, particularly in the summer, spot prices fall sharply, historically below $0.10 per MMBtu, forcing temporary well shut-ins and affecting pure-play gas producers.
However, associated gas, rich in NGLs, is well suited for value-added projects. Initiatives such as Vaca Muerta Liquids, led by Pluspetrol, and Argentina LNG, spearheaded by YPF alongside ENI and XRG/ADNOC, aim to capture that output through NGL fractionation and liquefaction for export markets.
Argentina posted an energy trade surplus of $6.068 billion in January-October 2025, surpassing the full-year 2024 figure. That surplus could climb to between $8 billion and $10 billion in 2026, with Vaca Muerta as the main driver.
Associated gas contributes directly to that dynamic. Each additional million barrels of shale oil generates gas equivalent to several MMm³/d, and monetizing it through NGLs or liquefied natural gas exports could eventually displace the soybean complex as Argentina’s main source of foreign currency.
By comparison, total natural gas production averaged between 140 and 141 MMm³/d in 2025, with winter peaks of 157 to 160 MMm³/d. Vaca Muerta accounted for between 65% and 70% of national output, with roughly 105 MMm³/d coming from unconventional gas.
Associated gas from shale more than doubled its contribution in 2025, representing a growing share between 20% and 30% of total shale gas production in the liquids window, according to Arceo’s estimates. This was driven by national oil output surpassing 800,000 barrels per day, about 70% of which was shale oil from Vaca Muerta.
The 2026-2030 test
The challenge now lies in infrastructure, including pipeline expansions, processing plants and final investment decisions on floating LNG units, in order to avoid flaring and maximize value. With ramp-ups underway in areas such as Bajo del Choique-La Invernada and La Calera, both operated by Pluspetrol, associated gas volumes are expected to continue rising.
Turning this byproduct into a stable source of foreign currency will be key to consolidating Argentina’s position as a net energy exporter beyond crude oil.
The 2025 record is not merely statistical. It signals that Vaca Muerta is shifting from a marginal producer to a regional and potentially global player. Associated gas, once viewed primarily as a logistical challenge, is emerging as a strategic asset if investment in midstream infrastructure and export capacity keeps pace.