The gas pipeline project connecting Argentina’s Vaca Muerta maxi-field to the Brazilian market will help establish Paraguay as a new energy hub in South America, strengthening regional energy integration. The project, with an estimated investment of approximately $2 billion, will span a 1,050-kilometre route, starting in Argentina (110 km), crossing the Paraguayan Chaco for 530 km, leveraging the Bioceanic Road Corridor infrastructure, and then reaching Brazil (410 km).
The technical and negotiation formalization phase saw the signing of a memorandum of understanding between Paraguay and Argentina, following the one already signed with Brazil. These agreements provide for the creation of bilateral working groups to carry out technical, engineering, and territorial impact studies, preparatory to the start of the pipeline construction works.
At the national level, the project is a strategic priority for Paraguay, which aims to increase its gas trade in the region – the Brazilian market is expected to double consumption over the next decade – but also to diversify its national energy mix, traditionally dependent on hydroelectricity, by introducing domestic gas use. This will not only ensure supplies to local industry at more competitive prices, but will also attract investment in key energy-intensive sectors, such as steel, chemicals, and fertilizers, currently held back by the lack of access to low-cost energy.
Finally, the pipeline’s entry into operation will generate significant revenue for Paraguay through tolling, transportation, and storage agreements, creating new job opportunities. With this project, which has already attracted the interest of international players such as the United States, the United Arab Emirates, and Spain, the country will not be a simple transit territory, but a central player with a long-term vision aimed at increasing its energy sovereignty and its negotiating clout on the international stage.
