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Argentina's Oldelval to invest $750 mln in Vaca Muerta pipeline to boost exports

·1 min read

BUENOS AIRES, Sept 16 (Reuters) - Argentine oil pipeline operator Oleoductos del Valle (Oldelval) will invest $750 million to double its transport capacity from the Vaca Muerta shale formation, the country's energy ministry announced Friday, hoping to boost exports and dollar reserves.

Oldelval aims to boost capacity to 72,000 per day from 36,000 cubic meters in two years, the ministry said, a project which should require a further 525 km (326 miles) of pipes to be laid and create 1,200 jobs.

That could boost Argentina's total oil exports to 250,000 barrels per day, the energy ministry estimated, with Vaca Muerta currently the world's second-largest reserve of shale gas reserve and fourth-biggest for shale oil.

"This project will allow us to double our transport capacity and allow the country to generate between $4 billion and $6.5 billion," Oldelval Chief Executive Ricardo Hosel said in a statement.

"This is a very important investment by the company and a great opportunity to increase crude exports," added energy secretary Flavia Royon.

Argentina, which is facing a significant energy trade deficit, is now betting on becoming a key energy exporter, aided by the massive Vaca Muerta shale reserve in Neuquen province.

The announcement came after the government approved a 10-year extension for Oldelval to operate pipelines from the Neuquen basin to Vaca Muerta until 2037.

The government is also planning to start building a gas pipeline linking Vaca Muerta with the capital Buenos Aires in the coming weeks. (Reporting by Eliana Raszewski; Writing by Sarah Morland; editing by Jonathan Oatis)