May 20, 2019 / 3:21 PM / a month ago

UPDATE 1-Argentina readies to join LNG exporters club with maiden cargo

(Adds context on imports, shale production)

LONDON, May 20 (Reuters) - Argentina is about to export its first liquefied natural gas (LNG) cargo from a new floating facility, marking a milestone for its energy sector boosted by rising gas production from its large Vaca Muerta shale region.

State energy firm YPF is believed to be offering a partial LNG cargo from FLNG Tango, the liquefaction vessel off Bahia Blanco, two LNG trading sources said on Monday. One source said the cargo was on a free-on-board (FOB) basis for prompt loading.

FLNG Tango, owned by Belgian shipping company Exmar , arrived in Bahia Blanca in February.

Argentina will become the 21st country to export LNG. It has long bought LNG, alongside buying pipeline gas from neighbouring countries and producing its own, to boost supplies especially during winter.

But rising output from Vaca Muerta, one of the world’s largest reserves of shale oil and gas, helped it reduce LNG imports by over 20 percent last year to 2.6 million tonnes, according to industry group GIIGNL.

The new exports do not mean Argentina will cease importing LNG; energy firm Integracion Energetica Argentina (IEASA), formerly known as ENARSA, has issued buy tenders for LNG cargoes for delivery throughout May to September.

The country needs billions of dollars in investment into the construction of pipelines, storage terminals and other energy infrastructure to fully benefit from its shale resources.

In many countries with a fast-developing energy industry, bottlenecks and price moves can mean that some regions are left energy poor while others export. Major LNG exporter Australia, for example, is seeking to import LNG soon. (Reporting by Sabina Zawadzki and Ekaterina Kravtsova; Editing by Toby Chopra and Mark Potter)

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