PUNTA COLORADA: A NEW STRATEGIC ENCLAVE IN THE WORLD ENERGY MARKET
- Nicolás Rueda
- Jul 11
- 11 min read
Argentina and its new energy hub on the Río Negro coast
Today, hydrocarbon derivatives, such as oil, natural gas, and coal, remain the foundation of the global energy mix, accounting for more than 70% of supply.
The market has opened up. The war in Ukraine led to the destruction of the Russian Nordstream gas pipelines supplying Europe. Shipping costs, which continue to rise significantly as a result of the war in the Mediterranean and the Red Sea, the Black Sea, and the China Sea, are key factors in understanding the direction of the global energy market.
The South American hydrocarbon surplus is beginning to stand out. In countries like Argentina, the opportunity to position themselves as a leading player in the industry is growing.
In 2010, the first phase of unconventional hydrocarbon exploitation began, with drilling carried out by YPF-Repsol in central Argentina. The Vaca Muerta Shale has a surface area equivalent to the size of Belgium and has the capacity to meet the national energy needs for the next 300 years.
Construction on the Vaca Muerta Sur pipeline will be completed in 2025. This project aims to connect the Oil&Gas Neuquén hub with the new distribution center located in the province of Rio Negro. The pipeline will concentrate approximately 40% of the basin's oil evacuation capacity.
In this article, we will explore the characteristics that make the Punta Colorado estuary in the Sierra Grande region a key shipping point for Argentina to be among the main energy suppliers for the next 100 years.
Investment and Development
Through 2024, shale formations are expected to attract approximately $10 billion, representing 75% of total upstream investment in the country.
Companies leading investment in Argentine unconventional:
YPF : 4.406 billion dollars
Pan American Energy (PAE) : $1.6 billion
Vista Energy : $945 million
Pluspetrol : 881 million dollars
TotalEnergies : $580 million
Tecpetrol : $523 million
Shell : $491 million
Chevron : $319 million
Pampa Energía : 239 million dollars.
Capsa : 211 million dollars.
Equinor : $190 million
Phoenix Global Resources : $175 million.
Aconcagua Energy : $46 million
Punta Colorada, located on the Atlantic coast of the province of Río Negro, Argentina, is preparing to become the epicenter of several long-term energy projects. Six leading oil and gas producers have confirmed their participation in the Vaca Muerta Sur megaproject, which seeks to establish an industrial and logistics hub for the export of hydrocarbons from Neuquén's unconventional oil.
The initiative has an initial investment of approximately $3 billion and the collaboration of some of the country's and the world's leading oil companies.
It's worth noting that the Texas-based company CB&I was selected to undertake the engineering, procurement, manufacturing, and construction (EPC) of the storage tanks with a total capacity of 630,000 cubic meters, equivalent to 4 million barrels of crude oil.
Two single-moon buoys located about six or seven kilometers from the coast will be added to this tank farm.
The largest oil tankers on the market (VLCCs, capable of transporting up to 2 million barrels) will be able to dock there and refuel with crude oil from Vaca Muerta.
In this initial phase, the Rosario-based company Milicic will be responsible for earthworks, the construction of access roads, and the necessary connections.
Meanwhile, the Spanish company Técnicas Reunidas will be responsible for the engineering of the storage terminal and the installation of monobuoys, floating structures designed to moor ships and transfer hydrocarbons.
The projected capacity reaches six million tons per year, and the national government has signed a 30-year permit. This authorization represents a fundamental step for Río Negro to consolidate its long-term production profile, generating employment, infrastructure, and further development for the entire region.
Projects with added value are planned for the Vaca Muerta asset. These include natural gas liquefaction plants and the introduction of purple hydrogen obtained from methane into new markets.
Once the port terminal is operational, the future holds promise for development in the region. Regarding the provinces, Neuquén receives a 12% royalty benefit. And Rio Negro will receive approximately $1 billion in royalties and fees over the first 13 years from the Vaca Muerta Oil Sur megaproject.
VMOS, the public limited company formed by YPF, Pan American Energy (PAE), Pluspetrol, Vista, Pampa Energía, Chevron, Shell and the Neuquén company GyP, agreed with the Rio Negro government to a one-time payment of $60 million as a contribution to territorial development, $40 million annually for 13 years called "community contribution", $14 million annually for the use of port, water and coastal infrastructure, $1.05 million annually for a control and inspection fee, $2 million annually as an environmental fee, and $18.5 million annually for gross income.
The commitment of the stakeholders involved will significantly expand Argentine oil exports, primarily to international markets such as North America and Europe, which will have a positive impact on the national economy.
Infrastructure
To date, the town of Sierra Grande, Rio Negro has:
One line of 500kva, another of 132kva.
A “General San Martín” gas pipeline, originating in Santa Cruz and crossing the province of Chubut.
A National Route 3 for heavy load transport, which crosses the province of Bahía Blanca.
A mining export port in Punta Colorado.
Technical Characteristics
Dock Name: Private Mineral Port - MCC Minera Sierra Grande Linear berthing meters: 300 Dock Draft: 12.5 meters Maximum Length: 225.12 meters Design Vessel Type: Panamax Land Area: 250 coastal hectares
Geographic Location
Located on Argentina's Atlantic coast, Punta Colorada is part of the Gulf of San Matías, 30 kilometers south of Sierra Grande and about 330 kilometers south of Viedma, the provincial capital.
This will be the site of the export port, where construction of a 250-hectare terminal is underway.
Location:
It is located in Bocamina S/N, Sierra Grande, San Antonio Department, Río Negro Province.
It is a few kilometers from Playas Doradas, the last town on the San Matías Coast, before Chubut.
Location
Latitude: 41°41'51.0"SLength: 65°00'24.6"WProvince: Río NegroDepartment: San AntonioLocation: Sierra GrandeAddress: Bocamina S/N
The reasons
Among the factors that made Sierra Grande the ideal choice are:
The proximity to Vaca Muerta, which reduces the need for transportation infrastructure compared to other ports in the country.
Favorable maritime conditions, with depths that minimize the need for dredging for large vessels.
The ample availability of land facilitates project development without major impacts on other local activities.
The possibility of creating a specialized port operation and leveraging synergies with the Vaca Muerta Sur Oil Pipeline.
Connectivity
The nearest airport for private aircraft is in San Antonio Oeste, approximately 100 kilometers to the north. Puerto Madryn International Airport is located approximately 150 kilometers to the south, offering domestic and international connections.
The pipeline will run from Añelo to the Lago Pellegrini area, crossing the entire northern Río Negro plateau and then descending toward the coastal area and reaching Punta Colorada, in the San Matías Gulf.
Route 5 connects Punta Colorada with the city of Sierra Grande. The latter has an airfield with potential for expansion. Route 9 connects Punta Colorada with Route 3. The latter links Punta Colorada with Bahía Blanca and the province of Chubut (Puerto Madryn and Comodoro Rivadavia).
Works
Regarding the pipeline, the first section will run between the towns of Añelo (Neuquén Province) and Allen (Río Negro Province), where it will connect to the Oldelval system. This will allow the start of oil transportation while awaiting completion of the second section and the export terminal in the Punta Colorada area, 35 km from Sierra Grande.
Soil preparation work is underway at the storage yard for the Vaca Muerta Sur pipeline asset. The crude oil reserve tanks will be housed here for subsequent dispatch at the Punta Colorado terminal.
Work is progressing rapidly under the project's main contractor, Milicic SA. The inspection verified compliance with established permits and environmental standards.
The projects led by YPF have the support and participation of VMOS, Pan American Energy, Vista Energy, and Pampa Energía.
By incorporating CB&I as VMOS's principal partner, it has been involved in the optimization of the project from its initial stage (FEED) to its award, focusing on cost reduction and improved construction schedules.
The Spanish company "Técnicas Reunidas" was also awarded a contract related to the project. This company will carry out engineering, procurement, and construction management (EPCm) for the development of the terminal in Punta Colorada. The contract, valued at $440 million, will require approximately one million man-hours.
Projects in Punta Colorada:
International oil dispatch port terminal.
Installation of two offshore monobuoys, located seven kilometers from the coast, prepared for large vessels.
Expansion of the "Vaca Muerta Sur" oil pipeline, including a 437-kilometer stretch that will connect Allen, the new Vaca Muerta oil hub, with the Atlantic coast.
Construction and installation of 20 reserve tanks, with a storage capacity of 1 million cubic meters, equivalent to 6.29 million barrels of crude oil.
Competencies
For every ship that would enter Punta Colorado to load oil, the equivalent of three ships would have to enter the port of Bahía Blanca to achieve the same capacity. This is due, among other factors, to the possibility of large vessels entering the Gulf of San Matías, thanks to the depth of the seabed in the area.
Bahía Blanca is three years ahead in terms of port infrastructure. The Bahía Blanca terminal is equipped, among other things, for the transit of bulk goods.
Another advantage of Punta Colorada is that it does not require a port terminal to export hydrocarbons, which significantly reduces initial investment costs. Both oil and gas can be transported through pipelines and supply vessels located 7 km from the coast.
The Rio Negro Sea, which is 40 meters deep, is five miles from the coast. It is used exclusively for oil and gas, meaning it does not require sharing with grain or other cargo vessels. A gulf that does not require dredging is the ideal location for developing oil and gas export activities.
It is estimated that the Río Negro port terminal will be able to load one ship every five days with a capacity of 390,000 cubic meters, nearly 2.5 million barrels, which is the capacity of the so-called Very Large Crude Carrier (VLCC) tankers. These large-capacity vessels would reduce transportation costs for Vaca Muerta crude oil and make it more competitive in international markets.
Logistics
Upstream
The unconventional asset is extracted from the Vaca Muerta coffers.
Transport
The crude oil travels from the Neuquén Hub through two pipeline sections to reach its destination in the province of Rio Negro.
Reception
The Sierra Grande distribution center receives and stores the asset.
Dispatch
In its final stage, the crude oil is reintroduced into pipelines to supply offshore cargo ships.
It's worth noting, as the president of YPF SA has mentioned on occasion, the United States' ability to reduce operating costs through cutting-edge logistics practices. The introduction of sands from the north and the initiative to transport freight by rail are some of the key points for understanding the added value and reduction in logistics costs. Future articles will expand on the long-term perspective for optimizing the oil and gas supply chain in Argentina.
Opportunities
The town of Sierra Grande, near Punta Colorada, has a population of approximately 14,000. It is estimated that with the implementation of the Vaca Muerta Sur project, the region will experience significant population growth. Projections indicate that by 2026 and 2027, the population will increase to between 20,000 and 25,000 inhabitants, driven by the demand for labor and services associated with industrial development.
Once the pipeline is connected, studies project a transport capacity of one million barrels per day, generating an estimated $15 billion in revenue per year from crude oil exports.
The "Vaca Muerta Sur" oil pipeline project is being promoted by the oil company YPF SA, with the support of the National Government and the provinces of Río Negro and Neuquén. It has invested more than $1.2 billion so far through 2025, in addition to $1.3 billion contributed by the private oil sector.
These figures would allow for an exponential leap forward for the Vaca Muerta Shale, multiplying current crude oil exports ninefold. This would be in parallel with the development of the Punta Colorada coastal region in Rio Negro.
In terms of real estate, the planned development next to the Punta Colorada deepwater station, with direct access to its fishing dock and just minutes from the "golden beaches," is poised to become the main vacation resort after "Las Grutas." It was designed with a variety of surfaces designed to meet the needs of this new hub of economic and social development.
The Costa Dorada development consisted of five phases, with more than a thousand residential lots, which already have electricity, water, and permanent residents. The industrial initiative that emerged after YPF's strategic investment led the Roca company to analyze alternatives to support the megaproject. Thus, phases 4 and 5 were transformed into what we know today as Macizo 5.
In this context, the Terbay Group, a shareholder in the Costa Dorada Urbanization Trust, decided to transform the final stage of the coastal development located in Punta Colorada, Río Negro, into an industrial subdivision. The project offers more than 300 lots designated exclusively for industrial and/or commercial use, making it an ideal ecosystem for companies of different sizes and activities to establish themselves in an exclusive area and develop or expand their businesses. The project includes the opening and leveling of streets, as well as infrastructure works for the electrical grid (medium and low voltage).
The combination of accessibility, service availability, and feasibility make it a highly attractive hub for new investment in the region.
Once operational, the crude oil dispatch terminal will generate a significant economic impact, not only for the development of the Argentine energy industry and its regional economies, but also for the global energy market. This project is expected to be a key driver for generating employment, attracting investment, and facilitating exports to other continents.
Sustainability and environment
The offshore buoy system is an unconventional model for docking ships. The main advantage of avoiding the construction of a port terminal in Punta Colorada is that it significantly reduces the environmental impact and contributes to the preservation of the ecosystem.
The process, which marks the beginning of a phased development over the coming months, is aligned with Resolution RESOL-2024-259-E-GDERNE-SAYCC#SGG and Provincial Law No. 3266 on Environmental Impact Assessment, ensuring a sustainable start to construction.
International Context
Currently, sanctions against Russia have tightened demand for all types of crude oil carriers, as the voyage to Russia's main current customers, China and India, is much longer than a week-long voyage from a Russian port in the Baltic Sea to northwest Europe.
In a tighter tanker market, day rates are rising and are expected to remain high for at least another two years, according to analysts and shipowners.
Growing Chinese demand is set to boost global consumption this year, and Chinese refiners are booking tankers to transport crude on long-haul voyages, further straining the market for large-capacity tankers and driving up tariffs.
With US oil prices at a discount to the Middle Eastern benchmark, more US crude is expected to arrive in China by the end of the second quarter of this year, according to banks, brokers, and shipowners.
Tanker rates are also under upward pressure due to reduced vessel availability, as more vessels are participating in the Russian oil trade and are no longer available to other shippers.
The southern governors' request is that the natural resources extracted from their lands be industrialized within them, thus obtaining value-added export products, generating employment and economic development in Argentine Patagonia.
"We don't want (port) consortiums, we don't want municipalities managing ports, we don't want unions managing ports, we don't want business chambers managing ports. The port is part of a complex of costs for the oil and gas industry, and we are convinced that it should be managed by a private company. To compete internationally, we must have efficiency and long-term certainty within the specific context of the competition between Bahía Blanca and Punta Colorada for investment from private players."
Governor of Rio Negro Alberto Weretilneck
A historic opportunity
Since the 19th century, Argentina has stood out internationally as an agricultural producer. According to a PwC report for international investors, Argentina could achieve an energy surplus of USD 30 billion by 2030, placing the oil sector on par with agricultural exports.
With the potential to transform regional and global logistics, the Punta Colorada terminal is on its way to becoming a leading logistics hub and represents a milestone in the energy infrastructure of Argentina and South America.
This project embodies Argentina's long-term vision to expand its economic and geopolitical influence in a region rich in resources and opportunities.
It will be crucial that the logistics strategies implemented meet international standards and that national policies support development and strengthen agreements to position Argentina as a competitive player in the energy market.
By Nicolas M. Rueda / Lucas R. García
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