Oil & Gas in
South America

Argentina and Brazil dominate the Southern Cone oil and gas map, but their markets cannot be read through the same model. Brazil is an established offshore operating market. Argentina is an unconventional production and infrastructure-expansion market whose next phase depends on domestic pipeline reconfiguration, regional exports and LNG development.

The central commercial question is therefore not the size of the resource base. It is which infrastructure is operating, which capacity is being expanded, which projects are only approved or planned, and which companies control purchasing and execution at each stage.

The strategic context has also changed. Brazil produced 4.498 million barrels of crude oil per day in July 2026, while Argentina reached a record 916,200 barrels per day. In a global market exposed to shipping chokepoints and supply disruption, diversified South American production has become more relevant to buyers. That broader resource-security argument is developed in South America’s Strategic Resource Advantage in a Fragmenting World Economy.

Two oil and gas systems shape the regional market

Argentina: from Vaca Muerta to an energy and industrial system

Vaca Muerta is the production base, not the entire market. The operating system begins in Neuquén, where wells, gathering, treatment, roads, camps, equipment, local labor and service yards make production possible. It then extends into pipelines, power generation, refining, petrochemicals, fertilizer feedstock and export infrastructure.

Argentina’s gas-pipeline system is being structurally reconfigured

Resolution 66/2026 describes a permanent change in Argentina’s gas geography. Production from the Neuquén Basin has grown, Northwest Basin supply and Bolivian imports have declined, and historical north-to-south flow assumptions no longer match the present supply system.

The official name of the trunk pipeline formerly known as the Gasoducto Presidente Néstor Kirchner is now the Gasoducto Perito Francisco Pascasio Moreno. Its first section is operating, while later expansion and contractual use must be read separately.

The San Matías corridor gives LNG a concrete infrastructure layer

Argentina’s LNG strategy is no longer only a broad ambition. Resolution 873/2026 approved the San Matías Pipeline project under RIGI. The planned dedicated line would run approximately 480 kilometres from Tratayén to San Antonio Oeste, use a 36-inch diameter and carry up to 27 million cubic metres of gas per day toward future liquefaction installations.

The project creates a defined corridor between Vaca Muerta and Atlantic LNG infrastructure. Its status has advanced since the original RIGI approval: Golar reported in August that EPC contracts for both the roughly 500-kilometre pipeline and compressor plant had been awarded, provincial environmental approvals were secured and financing discussions were at an advanced stage. Construction completion, commissioning and stable gas delivery remain separate milestones.

Southern Energy is also moving the liquefaction and offtake chain forward. FLNG Hilli is being repositioned for modifications ahead of its next long-term contract beginning in 2027. FLNG Esperanza remains under conversion, with Golar reporting the work on schedule and commercial start targeted for the second half of 2028. Southern Energy and Germany’s SEFE have signed an eight-year Heads of Agreement for 2 million tonnes of LNG per year from late 2027. The much larger Argentina LNG project remains at an earlier stage after submitting a US$51 billion RIGI application in August 2026.

Argentina–Brazil gas integration remains a route-selection problem

The bilateral technical report completed in April 2026 assessed alternatives for firm Argentine gas exports to Brazil through Bolivia, Paraguay, Uruguay and a direct connection. It also identified Brazil’s industrial demand as a potential anchor for deeper regional integration.

The report is evidence of technical evaluation and political coordination. It is not evidence that one route has secured financing, capacity, customers or a final investment decision. All options require additional transport infrastructure in Argentina to evacuate larger volumes from Vaca Muerta.

Argentina company and infrastructure cases

These companies do not share one procurement structure. Operator purchasing, project-company procurement, pipeline EPC, LNG development, power generation and petrochemical demand create separate qualification paths and decision centres.

Brazil is the operating offshore benchmark

Brazil’s oil and gas position is built around active deepwater production rather than a future resource-conversion story. ANP data show national output of 5.851 million barrels of oil equivalent per day in July 2026, including 4.498 million barrels per day of crude oil. Pre-salt production reached 4.821 million boe/d and represented 82.4% of Brazil’s total output.

Petrobras’ own operating scale also increased. In the second quarter of 2026, the company reported record total oil-and-gas production of 3.34 million boe/d and own pre-salt production of 2.78 million boe/d. Búzios reached operated production of 1.219 million barrels per day on 26 June after the P-79 entered production.

New FPSOs, ramp-up performance, subsea systems, offshore support, maintenance, reservoir management and long supplier chains define the Brazilian market. This creates a different opportunity profile from Argentina: more recurring operational demand, but also mature qualification requirements and complex operator structures.

Brazil’s offshore supplier landscape is also expanding beyond the established pre-salt production base. On 14 August, Petrobras announced hydrocarbons at the Morpho exploratory well in block FZA-M-59 in deep waters off Amapá. The discovery does not establish commercial reserves or future production, but it strengthens the case for continued exploration, logistics and supplier-capacity planning in the Equatorial Margin. Petrobras’ 2026–2030 plan allocates US$2.5 billion to the region and foresees 15 new wells.

This remains an exploration market rather than an operating production province. Supplier demand therefore needs to be separated between current drilling and marine logistics, appraisal work and any later development-stage procurement.

Brazil’s second offshore cycle: decommissioning

Brazil’s offshore market is now developing in two directions at once. New FPSOs, pre-salt expansion and Equatorial Margin exploration create growth-related demand, while mature assets are creating a separate procurement cycle around well abandonment, subsea recovery, platform removal, dismantling and materials recycling.

Petrobras’ 2026–2030 Business Plan allocates US$9.7 billion to sustainable asset disposal and well abandonment. Its published decommissioning portfolio identifies 18 platforms for removal, around 500 offshore wells requiring abandonment interventions and approximately 1,800 km of flexible lines to be recovered. A further 50 platform removals are identified for 2031 and beyond.

This creates a supplier market that overlaps with the wider offshore ecosystem but has different package structures. Plugging and abandonment, EPRD, subsea disconnection, ROV work, marine support, heavy lifting, industrial cleaning, waste handling, ports, shipyards and recycling become relevant in ways that new-field development alone does not capture.

The market is visible in the current industry agenda as well. ROG.e 2026 includes a dedicated September 21 Supply Chain Forum session on “Decommissioning in Brazil: Pathways to Overcoming Challenges” with Petrobras, Gerdau, Trident Energy and SBM Offshore. Econosur examines the supplier implications separately in Brazil’s Offshore Decommissioning Market: Where the Next Supplier Cycle Is Starting.

Gas monetization also depends on domestic industrial demand

Export infrastructure receives most attention, but domestic gas value also depends on thermal power, petrochemicals, fertilizer feedstock and specialized industrial systems. These users can stabilize demand and deepen local value creation, although each project has its own capital, technology and operating risks.

Execution and procurement follow the asset and project stage

A useful supplier map begins with the buyer and the project status. Upstream operators, pipeline concessionaires, dedicated project companies, LNG developers, power generators and industrial users purchase through different systems. The Vaca Muerta investment map adds the capital layer by separating announced plans, approved projects, financing, construction and operating investment.

Three business questions that require deeper research

Research services for South America’s oil and gas market

Econosur can structure custom research around one operator, RIGI project, pipeline, LNG development, supplier category or procurement question.

Where the objective is a concrete commercial connection, Econosur can also identify and screen relevant operators, buyers, suppliers, contractors, distributors and business partners and facilitate introductions where there is a relevant fit. See B2B Connections in South America.

Frequently asked questions about South American oil and gas