Argentina has pumped oil for more than a century, but its ambitions to become a global crude exporter were long constrained by infrastructure gaps, capital scarcity and macroeconomic volatility. That equation has now changed. Record output from the Vaca Muerta shale formation and a decisive push into export capacity are reshaping the country’s energy outlook. At the center of that shift sits Vaca Muerta Oil Sur (VMOS), whose $2 billion syndicated project financing is the largest private infrastructure loan ever completed in Argentina — and a landmark reopening of cross-border project finance.
For its scale, structure and systemic impact — reopening project finance, validating a new investment regime and delivering infrastructure essential to Argentina’s export future — the VMOS $2 billion pipeline financing is a clear choice for Loan of the Year.
The transaction, which closed in July 2025, funds the construction of the Vaca Muerta South crude oil pipeline and associated export facilities linking Argentina’s shale heartland to the Atlantic coast. More than a financing milestone, the deal provides the evacuation capacity required to unlock sustained export growth from one of the world’s most prolific unconventional basins at a moment when Argentina is rebuilding macroeconomic credibility and investor confidence.
“This was the largest private financing in the history of Argentina so far and it was a sign to international markets that Argentina had returned, reopening project finance that had been closed since the previous decade,” says Gustavo Chaab, VMOS chief executive.
The five-year senior secured term loan carries pricing of SOFR plus 5.5% and was arranged and syndicated by a group of international banks acting as joint lead arrangers and bookrunners, alongside a broader syndicate of 14 additional international lenders and institutional investors. The breadth and depth of the lender group underscored renewed appetite for Argentina risk when paired with robust structuring and regulatory support. The $2 billion facility covers roughly two-thirds of the project’s estimated total investment, with the balance funded through equity contributions from VMOS shareholders via a dedicated special-purpose entity.
What made the financing bankable was a combination of regulatory stability, contractual innovation and carefully engineered cashflow protections. Equally critical were the ship-or-pay transportation agreements underpinning the revenue model.
The financing was also structured to navigate Argentina’s foreign-exchange controls. Through RIGI eligibility and carefully designed offshore account mechanics linked to export revenues, VMOS can receive and retain US-dollar cashflows abroad, ensuring timely debt service and materially reducing convertibility and transfer risk for lenders — a longstanding obstacle to cross-border financing in Argentina.
VMOS is owned by a consortium of Argentina’s leading oil and gas producers, combining upstream scale, technical expertise and long-term alignment. Additional producers hold participation options that allow future expansion of pipeline capacity as production from Vaca Muerta continues to grow, embedding scalability into both the asset and the financing structure.
The project involves more than 430 kilometres of crude oil pipeline running from Neuquén to a new Atlantic export terminal at Punta Colorada, in Río Negro province. The terminal will include storage capacity of approximately 4.5 million barrels and offshore loading facilities capable of handling very large crude carriers, positioning Argentina to ship directly to global markets without reliance on third-party infrastructure.
Initial transport capacity is designed at approximately 180,000 barrels per day, ramping up to more than 550,000 barrels per day by the end of 2027, with further expansion to around 700,000 barrels per day achievable through the addition of pumping stations. First oil is expected in late 2026, with commercial operations commencing in 2027.
By relieving midstream bottlenecks, VMOS is expected to materially lift Argentina’s crude exports, improve foreign-currency inflows and consolidate the country’s position among South America’s leading oil exporters.
“Our project opens many possibilities for Vaca Muerta and Argentina. It will make Argentina a global energy player,” says Chaab.
Vaca Muerta Oil Sur (VMOS) $2 billion Pipeline Financing
Lead Arrangers: Citi; JP Morgan; Santander; Itaú; Deutsche Bank
Counsel to Issuer: Sullivan & Cromwell; Bruchou
Counsel to Lenders: Milbank; Beccar Varela
