Andean Oil Finds a Steadier Route

A long-term export pact puts Vaca Muerta back in the regional spotlight

8 Dec 2025

Argentina’s Vaca Muerta shale patch has surfaced again, this time through an export pact that ties state-run YPF to Chile’s ENAP. The arrangement, hailed by analysts as one of the region’s most significant deals this year, will send Argentine crude across the Andes and deepen a commercial link that has long struggled to gain scale.

The pact binds YPF with Shell Argentina, Equinor and Vista Energy in a supply chain running to 2033. It allows shipments of up to 70,000 barrels a day and could yield some $12bn over its life. For producers seeking certainty, the terms offer a welcome anchor in South America’s unconventional sector and hint at a more integrated regional market.

The implications stretch beyond simple logistics. Guaranteed export volumes lift Vaca Muerta’s global profile and bolster Argentina’s effort to position its shale alongside more established basins. Executives argue that predictable terms can draw in new technology, spur drilling and quicken development in a formation long overshadowed by North America. YPF’s role has become central to turning the basin into an export-ready resource.

Timing helps. Regional demand for secure crude is rising, and Chile’s need for reliable supply gives Argentina a chance to reinforce a strategic energy link. Producers gain a dependable outlet that cushions them from domestic fluctuations. Shell Argentina says the corridor offers “the predictability needed to keep investment flowing.”

Still, the path is not without obstacles. Infrastructure gaps, political swings and environmental worries may slow progress. Yet analysts judge such risks manageable when set against the benefits of cross-border trade. Equinor notes that wider diversification will be vital as South American shale seeks a place on the global stage.

For now momentum is with the developers. The pact is expected to draw fresh partners, attract new infrastructure spending and sharpen the region’s competitive edge. South America’s shale story, once tentative, is picking up pace.