Martina Azcurra, Executive Manager – Chemicals,


"YPF QUÍMICA is evaluating with international partners projects focused on adding value to the production of gas and liquids associated with Vaca Muerta, including fertilizers, plastics and methanol."

Can you provide an overview of the capacity and output of YPF QUÍMICA?

YPF QUÍMICA has an installed production capacity of 2.2 million tons per year (Mt/y) in which the most important products are aromatics (with 0.55 Mt/y) and methanol (with 0.4 Mt/y), as well as products such as propylene, surfactants and specialties. Profertil, an equal share joint venture between YPF S.A. and Nutrien Inc., produces 1.3 million Mt/y of urea and ammonia for the fertilizer sector. Sales are distributed between self-consumption for YPF’s own refining processes (45%), the local market (45%) and regional market (10%), and YPF QUÍMICA’s profitability represents more than 11% of YPF’s downstream business.

How has YPF’s chemicals division performed been impacted by the Covid-19 pandemic?

With the onset of the pandemic in 2020, YPF initially saw a significant decrease in domestic and international demand, as well as in product prices. Then, in Q4 2020, as governments were paving the road to recovery and restrictions were lifted, both demand and prices recovered to even pre-pandemic levels by early 2021.

The need for hygiene generated by the pandemic gave us the opportunity to start a new line of healthcare products: alcohol-based hand rub and hand sanitizer gel – both derived by an exclusive formula developed by Y-TEC, a technology-based company whose core activity is the R&D for the energy sector. Y-TEC is a joint venture between YPF (51%) and the National Council of Scientific and Technical Research (CONICET, owning 49%), the primary institution responsible for the promotion of science and technology in Argentina.

What are the planned chemical and petrochemical investments in YPF’s pipeline for the coming years?

YPF QUÍMICA is evaluating with international partners projects focused on adding value to the production of gas and liquids associated with Vaca Muerta, including fertilizers, plastics and methanol. At the same time, we are making progress in the development of projects related to sustainable products, promoting YPF’s participation in the value chain of products that seek to reduce waste and emissions.

Can you elaborate on YPF's involvement in the development of Vaca Muerta?

YPF has been from the beginning and continues to be today, the main leader in the development of Vaca Muerta, thus generating high interest from world-class companies that have entered the business, either in partnership with YPF or independently. Efficiency at Vaca Muerta has dramatically increased over the years, and the field has become a rich tapestry of different companies producing more than 70,000 barrels of oil per day and 50 million cubic meters of natural gas per day, with a high five-year forecast increase. Development of this world-class resource and its derivatives will enable the expansion of the petrochemical industry not only in Argentina, but on a regional and global scale, in a similar way to that which has occurred in the USA from the production of unconventional hydrocarbons.

What potential do you see for Argentina to supply rising domestic gas demand and export to markets such as Brazil in the future?

We are very optimistic about the gas potential in Argentina in the coming years, as Argentina is the country with the second largest gas unconventional reserves in the world (behind China). The Vaca Muerta reservoir has 300 trillion cubic feet (Tcf) in gas resources, in addition to the already proven capacity for massive developments at scale with economic efficiency. All this potential is enough to cover domestic demand for many decades (with LNG imports and alternative fuels utilized for winter peaks). Therefore, there is great potential for gas monetization supplying regional markets: Chile in the short term, because of the existing infrastructure; import substitution in Bolivia in the midterm; and in the long term, the optionality of swaps for Brazil through Bolivia or exports that require big infrastructure.

Achieving efficient gas monetization for both the domestic market and for export projects is the main strategic challenge that the industry is currently facing. In collaboration with the government, regulations and new infrastructure projects need to be developed with upstream and midstream capex-intensive projects in mind.

Can you provide details regarding YPF’s initiatives that contribute to a circular economy?

YPF currently has two wind farms in operation with a total of 274 MW of installed capacity (one in the province of Buenos Aires and one in Chubut), in addition to a third project in the construction stage in the province of Santa Cruz, that will add 122 MW. The generation of renewable energies allows YPF to avoid emissions of 400,000 t/y CO2. The company is also developing a project linked to the chemical recycling of residual plastics.

YPF QUÍMICA is committed to Responsible Care® – the global chemical industry's voluntary initiative to drive continuous improvement in safe chemicals management and achieve excellence in environmental, health, safety and security performance. In 2022, we will launch an annual Sustainability Report, publishing the progress made by YPF’s chemical business in this area, as well as the key challenges moving forward.