Argentina is making a new push to pitch the building of a billion-dollar gas pipeline from its Vaca Muerta shale gas reserves to Brazil and is seeking financing for the project, a source at the Argentine embassy said Sept. 14.

Argentina’s new envoy in Brasilia, Daniel Scioli has proposed advancing the project in meetings with Brazilian President Jair Bolsonaro and his Mines and Energy Minister Bento Albuquerque.

“We are at the exploratory stage. Both governments want to go ahead with the project,” the diplomat said by telephone.

“There have already been some contacts with investors,” he added, requesting anonymity. A video conference between Albuquerque and his Argentine counterpart Darío Martinez on the gas pipeline will be held before the end of the month, he said.

Argentina is proposing a pipeline running 888 miles from the Neuquen province shale gas reserves to the border with Brazil at Uruguaiana and another 373 miles from there to the city of Porto Alegre, connecting to Southern Brazil's gas distribution network.

In an interview with Brazil’s Valor Economico financial newspaper, Scioli said the gas project makes sense for both nations. Brazil needs the gas and its industries would welcome cheaper shale gas, while securing a large market in Brazil would draw investors to Argentina to expand Vaca Muerta. It would take three years to build once it has been decided, he said. “This is our big bi-national project. Brazil needs the gas and we need the markets and investments,” Scioli told Valor.

But financing the project could be hard. Valor said the estimated costs are $3.7 billion for Argentina and another $1.2 billion for Brazil.

Onshore