Argentina's New Pipeline to Boost Domestic Gas Supply, Eye Export

(Reuters) — Argentine officials celebrated the formal kick off of a major natural gas pipeline on Monday, a project that will provide supply from the country's booming shale development to both homes and businesses as well as eventually allowing for exports.

The start of operations for the Northern Natural Gas Pipeline, originating in western Neuquen province, will put an end to imports from neighboring Bolivia while moving supply to population centers in northern provinces.

Neuquen is home to the massive Vaca Muerta shale formation, Argentina's main hope for additional domestic oil and gas production that could end the need for costly foreign supplies.

The newly-inaugurated project cost $710 million, with $540 million financed by the Development Bank of Latin America and the Caribbean.

The government in a statement touted the possibility of future natural gas exports to buyers in Bolivia, Chile and Brazil, marking a reversal in longstanding Argentine energy flows.

The project involved the reversal in the direction of gas moving on the Northern Natural Gas Pipeline, in addition to the construction of the La Carlota-Tio Pujio pipeline.

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