The Argentine Minister of Economy, Luis Caputo, and the Brazilian Minister of Energy, Alexandre Silveira, signed a memorandum of understanding today in the context of the G20 Summit, which is taking place in Rio de Janeiro.

Brazil is moving ahead with plans to import natural gas from Argentina's Vaca Muerta formation, after Brazil's energy ministry signed a memorandum of understanding with Argentina on Monday to identify the infrastructure needed to increase natural gas supplies.

The Argentine Minister of Economy, Luis Caputo, and the Brazilian Minister of Energy, Alexandre Silveira, signed the agreement today in the context of the G20 Summit, which is taking place in Rio de Janeiro.

Brazil expects import volumes from Argentina to reach 30 million cubic meters per day by 2030, part of a broader plan to use the fuel to accelerate industrial growth, the ministry said.

The MoU creates a bilateral working group to identify measures needed to make the supply of Argentine natural gas to Brazil economically viable. Argentina also needs to secure a market for its vast gas reserves in order to accelerate production growth.

The gas deal is expected to allow Brazil to buy 2 million cubic meters of gas per day early next year from Argentina's Neuquén and Río Negro provinces, and reach 10 million cubic meters over the next three years.

Initially, a pipeline running through Bolivia would be used to ship the gas, but transport costs, a key issue, still need to be resolved, the ministry said. Bolivia supplied the fuel to Brazil and Argentina until its production declined.

Other transportation infrastructure options to expand the flow of Argentine gas to Brazil could include new pipelines that could go through Argentina or even through Paraguay, and shipments of liquefied natural gas from Argentine terminals to terminals on the coast of Brazil, the official said. Argentina’s energy ministry did not immediately respond to a request for comment.