Latin America&Caribbean Energy Transition 2025

Energy transition goals: Energy access and reliability. Industrial competitiveness. Energy productivity/efficiency. Problem description: Argentina’s energy mix long depended on imports, costly liquid fuels and weak integration. Despite vast Vaca Muerta shale gas reserves, infrastructure and market gaps hindered displacement of high-carbon fuels, export growth and stronger energy security. Solution description: The government and Yacimientos Petroliferos Fiscales (YPF) launched an integrated strategy to expand gas production from Vaca Muerta and build transport, liquefaction and commercialization infrastructure. Argentina’s Plan for the Production and Supply of Argentine Natural Gas (2020) incentivized producers, while the Néstor Kirchner Gas Pipeline (2023) boosted evacuation capacity. LNG export terminals and cross-border pipelines are planned, positioning natural gas as Argentina’s transitional lever for cost-competitiveness and decarbonization. Enablers used: Regulation and political commitment: Argentina’s Plan for the Production and Supply of Argentine Natural Gas with multi-year supply contracts, policy support for LNG exports, regional cooperation initiatives. Infrastructure: Néstor Kirchner Gas Pipeline Phase I (2023), planned LNG export terminal, expansion of regional interconnectors. Innovation: Advanced drilling techniques reducing production costs, digital monitoring for methane emissions control. Financial Investments: ~$5 billion in upstream and midstream gas infrastructure (2020-2024). Stakeholders involved: –National ministry of energy. –YPF and other upstream producers (Tecpetrol, Pampa Energía, international majors). –Transportadora de Gas del Sur (TGS), Transportadora de Gas del Norte (TGN). –Provincial governments of Neuquén and Río Negro. –Regional partners (Chile, Brazil, Uruguay). –Local communities and labour unions. Outcomes achieved: –Reduced reliance on LNG imports through stabilization of domestic gas supply. –Cost savings by displacing liquid fuels in thermal generation. –Improved reliability of electricity generation with lower marginal costs. –Regional integration pathways established, with initial exports to Chile and plans for Brazil. –Methane reduction programmes initiated in Vaca Muerta fields to align with emissions reduction goals. Exportable lessons: –Gas as a transition fuel: Harnessing domestic gas resources can accelerate emissions reduction when used to displace more carbon-intensive fuels. –Market design matters: Long-term contracting frameworks such as Argentina’s Plan for the Production and Supply of Argentine Natural Gas can provide investment certainty in volatile environments. –Regional cooperation amplifies benefits: Cross-border pipelines and LNG trade enhance energy security and cost optimization beyond national borders.CASE STUDY 8 Energy integration and decarbonization in Argentina (2020-ongoing)57 Energy Transition Readiness: Latin America and the Caribbean 29