Argentina to resume gas exports to Chile next month: ministers

The announcement follows an April 2018 energy agreement signed by Argentinian President Mauricio Macri (R) and his Chilean counterpart Sebastian Pinera, (pictured April 2018)

Argentina will resume gas exports to neighboring Chile from next month after an 11-year hiatus, the energy ministers of both countries announced Wednesday.

The announcement follows an energy agreement signed in April between Chile's President Sebastian Pinera and his Argentine counterpart Mauricio Macri.

"We are repealing all the prohibitions that we had in the last decade," Argentina's Energy Minister Javier Iguacel said after talks with Chilean minister Susana Jimenez in Santiago.

"Today we already have five export permits requested for Chile," Iguacel said, adding that Argentina was ready to begin shipping supplies from September.

The existence of seven gas pipelines running between the countries since the 1990s will facilitate early delivery.

Chile's energy ministry said in a statement that it would now be possible to "import gas from Argentina without restrictions or refund obligations, as was the case."

For Chile -- a net importer or energy - the resumption of Argentine gas deliveries could replace imports from elsewhere and mean a reduction in electricity costs.

Argentina was Chile's main provider -- once exporting 22 million cubic meters a day to its neighbor -- but restricted deliveries to emergency provisions when its own supplies ran low in the mid-2000s.

Iguacel said Argentina was able to export again thanks to surplus gas from the revamped Vaca Muerta gas field in the Andes due to increased investment over the last 18 months.

Argentina sits atop one of the world's biggest shale-gas reserves.