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Vaca Muerta delivered a historic energy surplus of US$ 7.8 billion in 2025 and became the centerpiece of Javier Milei’s economy — surpassing even the Brazilian Pre-Salt record in reversal pace
In just 12 years, Argentina went from an energy deficit of nearly US$ 7 billion in 2013 to a record surplus of US$ 7.815 billion in 2025. The engine of this 180-degree turnaround is called Vaca Muerta, Argentina’s largest shale oil and gas formation, located in the province of Neuquén, in Argentine Patagonia.
The data, released by INDEC and compiled by Shale24, show that Vaca Muerta pumped exports of US$ 11.086 billion in 2025 — an increase of 12.8% over 2024. About 70% of Argentina’s entire trade surplus for the year came from the energy sector.
For a country that lived for decades depending on imports of Bolivian gas and expensive diesel, the number is a dramatic turnaround. And it is indeed becoming the most solid pillar of Javier Milei’s economic program, the president who took office in December 2023 with the impossible mission of balancing Argentina’s public accounts.
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What is Vaca Muerta and why it matters
Vaca Muerta is a geological formation of approximately 30,000 square kilometers — equivalent to the size of an entire country like Belgium. It is estimated to hold about 308 trillion cubic feet of recoverable natural gas and billions of barrels of oil trapped in low-permeability rocks.
Unlike Brazil’s conventional Pre-Salt oil, extraction in Vaca Muerta requires hydraulic fracturing — the famous American “fracking.” Therefore, the region is often compared to the Permian Basin in Texas, considered the largest oil producer in the United States.
As reported by Click Petróleo e Gás recently, the Permian discovered additional hidden layers that expand the extraction potential — a similar challenge faced by Argentine engineers to unlock the Neuquén reservoirs.
The growth engine: shale surges while conventional declines
The latest data from INDEC, referring to January 2026, clearly show where the engine of the Argentine miracle is. In just the first month of the year, total oil and gas production reached 882.2 thousand barrels of oil equivalent per day (boed), an increase of 16.5% over December.
On the other hand, Argentine conventional basins continue in free fall — they declined 4.9% in the entire year of 2025. In other words, all of Argentina’s production growth today comes from unconventional shale. Vaca Muerta alone sustains the upward curve.
As analyst Fernando Bazán from the consultancy Abeceb stated in an interview cited by GBM, “the growth engine is Vaca Muerta, given that the rest of the basins are in decline.” According to Bazán, oil exports account for 86% of all Argentine energy surplus.
In January 2026, the energy surplus was US$ 618 million, with exports of US$ 781 million — equivalent to 11.1% of all Argentine exports for the month.
The pipelines that double everything: VMOS and Punta Colorada
The real leap, however, is yet to come. Argentina is building two mega infrastructure projects to transport oil from Vaca Muerta directly to tankers crossing the Atlantic.
The first is the VMOS (Vaca Muerta Sur) pipeline, with guaranteed financing of US$ 2 billion. It will start operating at the end of 2026 with an initial capacity of 180 thousand barrels per day. Subsequently, in 2027, it is expected to expand to 550 thousand barrels daily, generating estimated revenues of US$ 14 billion annually.
The second is the export terminal in Punta Colorada, in the province of Río Negro. The works are already more than 50% complete. When fully operational, it is expected to generate up to US$ 15 billion per year in maritime exports, according to official projections.
In other words, what seemed like a statistical anomaly of the Milei government could become a permanent trend. Horacio Marín, executive president of YPF, stated in January: “Today the work exceeds 50% progress and opens the door to a new export stage for us.”
Milei and the “Vaca Viva”: the Argentine president’s political bet
To understand why Vaca Muerta became central in Milei’s political narrative, one must look at the government’s math. The energy surplus of nearly US$ 7.8 billion in 2025 represents practically the entire fiscal adjustment the government needed to close external accounts in the short term.
This means that without the Patagonian shale, the “miracle” that Milei has been selling to international investors — fiscal surplus, falling inflation, return of credit — would likely be impossible. In fact, the president began calling the project “Vaca Viva,” in contrast to the original geological name.
From the diversification perspective, the numbers also help. Argentine diesel imports fell 75.2% and gasoline imports dropped 49.6% in January 2026, reflecting substitution with domestic production.
The numbers of January 2026: the start may have been cold, but stable
To understand if the turnaround will last, it’s worth looking closely at January. Total energy exports fell 14.1% in the month compared to January 2025 — but the drop came almost entirely from international prices, which fell 13.2%, and not from operational problems.
According to INDEC, the physical volumes exported were only 1% below January of the previous year. In comparison, Argentine energy imports plummeted 21% in the same period — a clear sign of growing self-sufficiency.
This combination yielded Argentina the 26th consecutive month of total trade surplus, valued at US$ 1.987 billion. Consequently, the country became a structural net energy exporter, something that seemed unthinkable just five years ago.
International comparison: Permian, Pre-Salt, and the Argentine case
To understand the magnitude of the feat, it’s worth the international parallel. As recently reported by Click Petróleo e Gás, Brazil broke its own historical production record in February 2026, driven by the Pre-Salt, with about 4.5 million boed.
Still, in proportion to the economy, the fiscal impact of Vaca Muerta on Argentina is greater than that of the Pre-Salt on Brazil. This is because the Argentine balance started from an energy deficit, while Brazil was already an oil exporter since 2022.
Furthermore, Vaca Muerta competes directly with the Permian Basin in Texas in geological structure and extraction cost. At that time, the Argentine learning curve is advancing rapidly — the break-even in the basin fell from US$ 60 per barrel in 2018 to near US$ 35 in 2025, according to industry data.
- US$ 7.815 billion — Argentina’s record energy surplus in 2025
- US$ 11.086 billion — total energy exports in 2025 (+12.8% YoY)
- 882.2 thousand boed — Argentine production in January 2026 (+16.5% MoM)
- 180 thousand bpd — initial capacity of VMOS at the end of 2026
- 550 thousand bpd — VMOS capacity target in 2027
- 1 million bpd — Argentine production projection in 2030
LNG exports begin in 2027 — and could change the game
The next chapter already has a set date. Liquefied natural gas (LNG) exports from Vaca Muerta are expected to begin in 2027, according to Megawhat, with combined investments exceeding US$ 16 billion.
For this, Argentina has already reorganized its gas pipelines. In particular, the historic reversal of the Gasoducto del Norte was a milestone — for decades, the pipeline brought Bolivian gas to southern Argentina.
From now on, it operates in the reverse direction, exporting gas from Vaca Muerta to Brazil and replacing Bolivian imports that seemed permanent.
According to senator and economist Agustín Monteverde, the most conservative projection is that the Argentine energy surplus will reach US$ 8.8 billion in 2026. The most optimistic estimates speak of up to US$ 10 billion — which would make 2026 another absolute record year.
Caveats: the sky is not entirely clear
Even with the brilliant numbers, not everything is rosy. The 13.2% drop in international prices in January 2026 shows how the economy of Vaca Muerta still heavily depends on external factors. If Brent falls further, the surplus could shrink quickly.
Moreover, the concentration in a few operators — YPF, Tecpetrol, Pampa Energía, Shell, Chevron, Pan American Energy, and Pluspetrol — creates systemic risks. Any regulatory or environmental issue in a single company can affect the entire production curve.
Finally, the uncomfortable question remains. If the Argentine economy increasingly depends on a single hydrocarbon basin, what happens when the world, pressured by the energy transition, starts buying less oil? Will Milei have time to transform the “Vaca Viva” into something more sustainable before the global demand curve changes forever?
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