Pampa Energía would double gas production in 2024 and is listed for the NK Gas Pipeline

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Pampa Energía would double gas production in 2024 and is listed for the NK Gas Pipeline

Buenos Aires – Pampa Energy (PAM)one of the main energy companies in the Argentine private sector, reported in the first quarter of 2022 net income of US$100 millionan improvement of 156% compared to the same period in 2021. In addition, the company led by Gustavo Mariani and Marcos Mindlin achievement 33% increases in gas production, and 10% in electricity generation.

“Without a transportation bottleneck… we have enormous potential to continue growing,” said Mariani, CEO of the company, in a call with investors this Friday to present the quarterly results.

And I add: “We could double that production [de gas] in two years… and perhaps by 40-50% by next winter. That will depend on the success of the next stages of the Gas Plan tenders”.

      • 2023 Bonds: During the call, the CFO of Pampa, Nicolás Mindlin, did not provide any further information regarding the alternatives that the company is considering to face its debt maturities in 2023. In that sense, He stated that the situation depends on the possibility of reaching an agreement with the Central Bank of the Argentine Republic to be able to access the necessary foreign currency.
      • Quote: “As you may know, there is a Central Bank regulation in force until December 2022 that allows companies to pay 40% of capital maturities and refinance the other 60%. Since the current regulation does not reach our 2023, we will need to agree with the Central Bank to execute an agreement. We are actively looking at alternatives regarding our 2023 expiration and it should be quite reasonable to expect a liability management sooner rather than later, but it will depend on us getting the approval of the Central Bank. Our goal is to have an even stronger debt profile and pave the way to continue investing in our core business, especially increasing our gas production.” Mindlin stated.

During the first trimester, average gas production was 8.9 million cubic meters (m3) per day. In that way, the year-on-year rise of 33% exceeded the national average growth of 13%, year against year.

      • net debt: Decreased by US$21 million to US$845 million in the first quarter of 2021.
      • Adjusted EBITDA: Adjusted profit before interest, taxes, depreciation and amortization between January and March was US$226 million, or 11% more than a year ago.
      • Operating income: It was US$133 million, compared to US$109 million of the same period of 2021.

We are currently at 11 [millones de m3 por día, porque] just two weeks ago we finished some early production facilities that increased available capacity at The MangrulloMariani continued.

Regarding the gas exports to ChileMariani said: “We export 3 million m3 per day, 30% of our total production.” However, he warned that during the winter there will be no firm exports, although there will be cash.

As the weather cools, there will be more demand in Argentina and exports to Chile could stop, with some marginal ones continuing.”, he added, holding: “We hope to resume exports in October this year, in the summer months, but we don’t know if we will succeed or not.”

Nestor Kirchner gas pipeline

With respect to Nestor Kirchner gas pipelinethe executive maintained that “there’s a possibility” that it be finished building for next winter, which would add 11 million m3 to the evacuation capacity from Vaca Muerta in a first stage.

In this sense, he warned that the timeline it is “very tight, but it is still possible”.

We are eager to earn a part of those additional cubic meters”stated in this regard, also pointing out that the evacuation capacity of the gas pipeline would be increased in a second stage.

Electrical and renewable improvements

The 10% improvement in Pampa’s electricity generation was higher than the performance of the group of energy companies in the countrywhich achieved 1% year-on-year.

Pampa also reported that the thermal expansion in Ensenada Barragán, for which it is investing US$230 million in conjunction with YPF (YPF), advanced by 80%. The project will add 280MW of efficient power to the Argentine system.

On the other hand, the energy company reported that the Pampa Energía II Wind Farm (PEPE II), which involves an investment of almost US$130 million and will add 81MW of green energy to the system, is 25% complete.

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