Major energy producers operating in Argentina’s Vaca Muerta shale formation are moving closer to supporting a multi-billion-dollar natural gas liquids (NGL) development aimed at easing infrastructure constraints and supporting future production growth.

According to sources familiar with the matter, Chevron, state-owned energy company YPF, and private producer Pluspetrol are expected to finalize supply agreements with gas transportation firm TGS this week. The contracts would provide the feedstock needed for the proposed $3 billion project.

The planned facility is designed to process and transport natural gas liquids generated from the rapidly expanding Vaca Muerta shale basin, one of the world’s largest unconventional oil and gas resources.

Industry observers view the agreements as a significant milestone that strengthens the project’s prospects and helps address concerns over infrastructure capacity as output from the shale region continues to increase.

Chevron has been pursuing opportunities to expand its presence in Vaca Muerta, where production growth has attracted investment from both domestic and international energy companies. The project is expected to play a key role in ensuring that rising gas volumes can be efficiently processed and moved to market.

The development comes as Argentina seeks to maximize the economic potential of its shale resources, boost energy exports, and improve the infrastructure needed to support long-term growth in the country’s oil and gas sector.

If completed, the NGL venture would represent one of the largest recent investments linked to Argentina’s shale industry and could help remove logistical bottlenecks that have challenged producers in the basin.