Uruguay Begins Importing Gas from Argentina's Vaca Muerta, Saving $3 Million in First Week

Uruguay's state-owned electricity company UTE has begun importing natural gas from Argentina's Vaca Muerta formation, resulting in savings of approximately $3 million within the first week. The deal with Gasoducto Cruz del Sur enables access to reserves in Neuquén province, significantly impacting Uruguay's energy strategy.

The Punta del Tigre power plant in San José is the primary beneficiary, having started to replace expensive diesel with more affordable Argentine gas, consuming 7.5 million cubic meters to date. The contract is initially set for one year with options for renewal but remains 'interruptible' based on domestic demand in Argentina.

With a forecasted dry summer increasing electricity demand, the gas supply is crucial for thermal generation during peak periods. This supply line also reduces water consumption and machinery wear, contributing to UTE's goal of minimizing environmental impacts.