International Consortium Wins Bid for Vaca Muerta's $1.2 Billion Gas Pipeline

In a significant development for Argentina's energy sector, a consortium led by U.S. firm Pumpco and Italy's Bonatti has been awarded the contract to construct the country's largest-ever gas pipeline. The $1.2 billion project is a cornerstone of a liquefied natural gas (LNG) export initiative spearheaded by YPF, Italy's ENI, and Abu Dhabi's state-owned oil company Adnoc through its investment arm XRG.

This award is particularly noteworthy as both Pumpco and Bonatti have no prior experience operating in Argentina's energy infrastructure sector. They will collaborate with local partner Contreras Hermanos, which contributed to the project's design and engineering. The tender was exclusively international, preventing Contreras Hermanos from bidding directly. The consortium received formal notification of the award, though the project's final investment decision (FID) is still pending, expected by late 2026 or early 2027.

The new pipeline will span 527 kilometers, comprising two parallel lines: one for gas with a 48-inch diameter and another for liquids with a 24-inch diameter. It will connect the Meseta Buena Esperanza in Vaca Muerta to Sierra Grande in Río Negro province, where a maritime export terminal will be located. The winning bid from Pumpco, Bonatti, and Contreras Hermanos was reportedly 15% more economical than that of Techint-Sacde, the second-highest bidder.

This pipeline, if completed, will boast the largest diameter in Argentina, surpassing existing lines like the Perito Moreno (formerly Néstor Kirchner) and the duct financed by Southern Energy (SESA). The SESA project, also an LNG export initiative, involves partners such as Pan American Energy, YPF, Pampa Energía, Harbour Energy, and Golar LNG. While both LNG projects share geographical corridors and technical challenges, they are independent developments with distinct financing structures. Notably, the duct awarded to Pumpco and Bonatti runs parallel to the one SESA recently awarded to the Víctor Contreras and Sicim consortium.

This marks the second consecutive tender loss for Techint-Sacde, led by Paolo Rocca and Marcelo Mindlin, in the Vaca Muerta hydrocarbon export mega-projects. After being excluded from the SESA pipeline construction, Techint-Sacde has now lost the YPF-ENI-XRG gas pipeline bid by a significant price margin, despite being one of the few local companies eligible to compete.