Letter from South America: Vaca Muerta faces export challenges

The Argentine shale play hit new output highs recently, but doubts persist over monetisation

Oil and gas output from Argentina’s Vaca Muerta shale play rose to new highs in June 2021 despite the global pandemic. Shrugging off concerns of a deceleration in production in the second quarter, the rise has also dispelled more general anxiety about oil prices, potential government intervention and the effects of the energy transition. Questions remain, however, about the long-term monetisation strategies for Vaca Muerta gas. 38.5mn m3 – June’s record gas output Gas production in the Neuquen basin is impressive given the macro context. Unconventional gross gas production from the play rose to a new high of 1.36bn ft³/d (38.5mn m³/d) in June, up from 928mn ft³/d previously. Taking i