Argentina plans to close LNG importing facility

BUENOS AIRES (Bloomberg) -- Argentina plans to close a facility for importing liquefied natural gas (LNG), according to people with direct knowledge of the matter, after booming production from shale deposits in the Vaca Muerta region turned the country into a seasonal exporter.

A contract with Excelerate Energy, which has a regasification ship moored at the Atlantic port of Bahia Blanca, won’t be renewed when it expires at the end of the month, said the people, who asked not to be named because the decision isn’t yet public. Argentina will continue to import LNG at another facility in Escobar, on the River Plate estuary, the people said.

YPF SA, the state-run oil company that manages the contract, declined to comment on the decision. A spokeswoman for Excelerate didn’t immediately comment.

The decision not to renew the decade-old contract comes as output from Vaca Muerta, the nation’s answer to the Permian basin, has created an oversupply of gas during the summer. Shale gas production soared to 205 million cubic meters a day in August, more than triple the level seen a year earlier. The government has negotiated exports to Chile to help solve the problem. It has also initiated talks to receive less gas from neighboring Bolivia, with which it has a contract through 2026.

Three Cheniere Energy tankers were set to unload at Bahia Blanca this year through May, according to the latest official import schedule.