Activity levels are at all-time highs in Argentina’s prime oil and gas producing region, but equipment and transport bottlenecks are limiting its growth, an analyst said at a energy conference.

The Vaca Muerta shale region in the Neuquen province needs more drilling rigs, hydraulic fracturing fleets and natural gas pipelines transport to continue growing, said Alexandre Ramos, Rystad Energy’s vice president of shale research.

“Frac fleet availability is a massive bottleneck,” said Ramos. “We are seeing historically high gas production in Neuquen, so upcoming expansions are critical to allow Vaca Muerta to satisfy demand,” he said.

The South American country’s gas production so far this year is running 132 million cubic meters per day (mmcmd), according to state-run oil company YPF YPFD.BA, below 2004’s peak 142 mmcmd. Crude oil production this year is running at 559,000 barrels per day (bpd), below the peak 847,000 bpd in 1998.

Horacio Marin, oil producer Tecpetrol’s Exploration and Production chief, said the province could double its crude oil production and grow gas output through 2030 with an additional $7 billion devoted to drilling and completion, and $12 billion in infrastructure investments.

The historical downward trend has been partially offset in recent years by unconventional production of oil and gas coming from Vaca Muerta’s shale reserves, according to Francisco Bertoldi, a YPF vice president of upstream unconventionals.
Source: Reuters (Reporting by Marianna Parraga in Houston)