Natural gas from Argentina’s province Neuquén, home to most of the Vaca Muerta deposit, fetched $1.79/MMBtu on average in the latest online auction held by Argentina’s online gas market Mercado Electrónico del Gas (Megsa).
The tender, held in late March, was specifically for power generation for the month of April. The buyer of the gas was Compañía Administradora del Mercado Eléctrico Argentino (Cammesa), which is in charge of guaranteeing power supply to Argentina.
Megsa did not specify the seller companies that took part in the auction. The auction is now being held on a monthly basis for power generation and this is the fourth of its kind.
Prices for gas from Neuquén were capped at $2.67/MMBtu.
The auction is the first since the coronavirus has essentially halted Argentina’s economy. The nation has been on lockdown since the middle of March, and President Alberto Fernández extended the nationwide quarantine until the end of Holy Week, or April 11.
Last week, state energy firm Yacimientos Petroliferos Fiscales SA (YPF) director Daniel González said domestic gas demand was down 15-20%, from “previous days,” or compared to when the country was not on lockdown. He said demand for gasoline was down 70%, diesel 50% and aviation fuel 90%.
In January, the last month for which official information is available, Argentina’s production of natural gas rose by 0.8% year/year to 131.1 million cubic meters/day (MMm3/d), or 4.63 Bcf/d.
Shale gas production accounted for 32.5 MMm3/d (1.13 Bcf/d) of the total, up 12.8% from January 2019.
The majority of January’s natural gas — 81.5 MMm3/d (2.88 Bcf/d) — was produced in Neuquén.
Argentina has ordered 11 liquefied natural gas cargoes to help satisfy natural gas demand this upcoming Southern Cone winter.
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