Argentina-Brazil gas pipeline
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Brazil is discussing with Argentina the possibility of constructing a gas pipeline from Argentina’s vast Vaca Muerta (dead cow in Spanish) shale province, Brazilian President Jair Bolsonaro said.

    The cost of the pipeline could total $5 billion. Reuters news agency reported that the Argentine section of the project would amount to $3.7 billion and the Brazilian section $1.2 billion. It is not yet known how the project is to be financed.

    The project would allow Brazil to reduce domestic gas prices. The country this year is importing large volumes of LNG against the background of a very serious drought.

    According to data from the International Energy Agency (IEA), last year more than 75 % of power generated in Brazil came from hydropower. The country also accounts for two-thirds of the overall hydropower capacity throughout South America.

    But this year, the continent’s most densely-populated country is suffering from the most severe drought in 90 years. Hydropower generation is nonetheless continuing.

    Vaca Muerta, where production is recovering in the aftermath of the pandemic, is the world’s second largest shale deposit in the world. Its extractable resources amount to 16 billion barrels of oil and 308 trillion cu. ft. of gas.

    Argentina’s YPF energy company increased production of shale hydrocarbons in the second quarter by 22 % and gas by 48 %. About 200,000 barrels of oil per day are now being produced. YPF is investing $2.7 billion in the deposit this year – including $1.3 billion on drilling 180 exploratory wells. As of the end of July, 46 active drilling sites were in operation – four times greater than in July 2020.

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