A. Our History and Development
General
Operations
We commenced commercial operations on December 28, 1992, as the largest company created in connection with the privatization of Gas del Estado
S.E. (“GdE”), the Argentine state-owned natural gas company, the integrated operations of which included natural gas transportation and distribution. GdE was divided into ten companies: two transportation companies and eight distribution
companies.
Our legal name is Transportadora de Gas del Sur S.A. We are a limited liability company (sociedad anónima),
incorporated under the laws of Argentina on December 1, 1992. Our registered offices are located at Cecilia Grierson 355, 26th Floor, Buenos Aires (C1107CPG), Argentina, our telephone number is (54 11) 4371-5100 and our web address is www.tgs.com.ar.
According with our public records, our length of life is set to expire on November 30, 2091 (which could be renewed, in accordance with the applicable law).
We are currently the largest transporter of natural gas in Argentina and operate the most extensive pipeline system in Latin America in terms of
length, delivering approximately, as of December 31, 2025, more than 60% of the total natural gas transported in Argentina, through 5,746 miles of pipeline, of which we operate 4,768 miles on an exclusive basis pursuant to the License. Our
transportation system connects the Neuquén, San Jorge and Austral basins, the major natural gas fields located in the south and west of Argentina, to the greater Buenos Aires area and the major consumption centers of southern Argentina. During
the fiscal year 2025, approximately 81% of our revenues of this business segment corresponds to firm natural gas transportation services under firm long-term natural gas transportation contracts. Natural gas transportation customers with firm
contracts pay for the contracted pipeline capacity regardless of actual usage. Our Natural Gas Transportation business is regulated by ENARGAS, and revenues from this business segment represented 41%, 36% and 22% of our total revenues for the
years ended December 31, 2025, 2024 and 2023, respectively.
We conduct our Natural Gas Transportation business pursuant to the License granted under the Natural Gas Law No. 24,076 (“Natural Gas Law”).
Pursuant to the terms of the License, its original term was scheduled to expire on December 28, 2027 and, subject to compliance with certain technical and regulatory conditions, could be extended by the Executive Branch. In addition, the
Foundations Law, expanded the extension regime allowing extensions to be granted for an additional period of up to 20 years.
In accordance with Section 6 of the Natural Gas Law, on September 8, 2023 we submitted a formal request to ENARGAS to initiate the procedures
for the extension of our License. On June 13, 2024, ENARGAS issued its technical report concluding that we had broadly complied with our obligations under the License, the Natural Gas Law and applicable regulations. Following the non-binding
public hearing held on October 21, 2024, ENARGAS completed its review process and submitted its recommendation to the Executive Branch.
On July 24, 2025, the Executive Branch ratified the Memorandum of Agreement entered into between us and the Ministry of Economy on July 11,
2025, pursuant to which the term of our License was formally extended for an additional period of 20 years, commencing on December 28, 2027. As a result, our License will remain in effect through December 28, 2047, subject to continued
compliance with applicable legal, regulatory and contractual obligations. See “—B. Business Overview—Natural Gas Transportation—Regulatory Framework—Tariff situation—Certain Restrictions with Respect to
Essential Assets.”
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The License gives us the exclusive right to operate the existing southern Argentine natural gas transportation pipeline system. Our natural gas
transportation system connects major natural gas fields in southern and western regions of Argentina, with both distributors and large consumers of natural gas in those regions as well as in the greater Buenos Aires area, the principal
population center in Argentina.
The map below illustrates the natural gas pipeline system in Argentina as of December 31, 2025:
For additional information regarding our property, plant and equipment, see “—D. Property, Plant and Equipment”
below.
We are also one of the largest processors of natural gas and one of the largest marketers of Liquids in Argentina. We operate the Cerri Complex
and the associated logistics and storage facilities of Puerto Galván located in Bahía Blanca in the Province of Buenos Aires where Liquids are separated from the natural gas transported through our pipeline system and stored for delivery. Due
to its strategic location within the Argentine natural gas transportation system, our Cerri Complex can process gas proceeding from the Neuquén, San Jorge and Austral basins. This provides the plant with great versatility in terms of natural
gas availability, and the possibility to select the gas that is processed according to its quality (liquid contents). Revenues from our Liquids Production and Commercialization business represented 38%, 46% and 59% of our total revenues during
the years ended December 31, 2025, 2024 and 2023, respectively.
We also provide midstream integral solutions related to natural gas production, from the wellhead up to the transportation systems. In addition,
through our subsidiary Telcosur, we provide telecommunications services. Aggregate net revenues from our midstream and telecommunications business segment represented 21%, 18% and 20% of our total revenues during the years ended December 31,
2025, 2024 and 2023, respectively.
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Within the framework of the agreements signed with the former Secretariat of Energy, Mining and Hydrocarbons of the Province of Neuquén and Gas
y Petróleo de Neuquén S.A. in April and November 2018, we timely completed the construction of a catchment and gathering pipeline and a natural gas conditioning plant in the Vaca Muerta field that will allow the gathering of non-conventional
gas from the Neuquén Basin and its subsequent injection into the main gas pipeline systems, ensuring its supply to all of Argentina’s regions.
The Vaca Muerta system has two gathering pipes: the first has a length of 71 miles, a 36” diameter and a 35 MMm3/d transportation capacity (“Northern Section”) and the second has a 22 miles extension, a 30” diameter and 25 MMm3/d transportation capacity (“Southern Section”). The natural gas transported through this pipeline system is treated at a new conditioning plant that we built at Tratayén, Province of Neuquén with an initial capacity
of 7.8 MMm3/d. This project consolidates our position as the first midstream services provider in the Vaca Muerta field and required an investment of approximately
US$260 million in the aggregate. On April 29, 2019, the assembly and pressurization work on the connection of the Vaca Muerta pipeline to Neuba II Gas Pipeline were completed, which led to revenues from the month of May 2019. On August 22,
2019, the Secretary of Hydrocarbon Resources issued Resolution No. 491/2019, which declared this project as “critical” pursuant to Law No. 26,360. This allows us to obtain certain tax benefits from the investments in this project.
In March 2022, we executed an agreed minute with the Undersecretary of Energy, Mining and Hydrocarbons of the Province of Neuquén (Subsecretaría de Energía, Minería e Hidrocarburos de la Provincia del Neuquén) whereby the parties commit to granting us an extension of the transportation concession to build and operate the pipeline
expanded North Tranche II, which will gather the off-spec natural gas production from several hydrocarbons fields located mainly in the Vaca Muerta formation. In August 2022, we began this work with an investment of approximately US$ 48
million, this 20 miles long work will extend from the Los Toldos I Sur area to El Trapial (Vaca Muerta Norte). The pipeline has been operational since the end of July 2023.
In November 2024 and February 2025, we commissioned additional investments that allow us to expand our natural gas conditioning capacity and
increase our role in the Vaca Muerta development, including the installation of two conditioning turbine expanders provided by Propak Systems Ltd (each a “Propak Plant”) to be operated in gas conditioning mode until we are able to
develop a natural gas processing project in the Tratayén Plant. The Propak Plants may be converted to allow processing of natural gas in the future, and they increased our conditioning capacity by 6.6 MMm3/day for each Propak Plant. With the addition of the Propak Plants, our total gas conditioning capacity increased up to 28MMm3/d since February 2025. The total estimated investment for this expansion was US$350 million.
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For more information regarding our investments in Vaca Muerta area see “—B. Business Overview—Midstream—Midstream Services.”
Controlling shareholders
As of the date of this Annual Report, our controlling shareholder is CIESA, which holds 53.83% of our common stock. Other local and foreign
investors hold the remaining shares of our common stock, including FGS, which holds 25.33% of our common stock. CIESA is under co-control of Pampa Energía which holds 50% of the common stock of CIESA, and GIP and PCT, which directly and
indirectly through PEPCA hold 50% of the common stock of CIESA.
For additional information regarding CIESA’s current organizational structure, see “Item 7. Major Shareholders
and Related Party Transactions—A. Major Shareholders.”
Capital expenditures
From January 1, 2023, through December 31, 2025, our aggregate capital expenditures, in Current Currency, amounted to Ps. 1,052,282 million.
Such capital expenditures include Ps. 309,889 million related to natural gas transportation system, Ps. 46,945 million related to liquids production and commercialization activities and Ps. 695,448 million related to Midstream segment.
For the years 2025, 2024, and 2023, capital expenditures mostly include improvement to our natural gas transportation system and works performed
for the enhancement of Tratayén Plant and maintenance works of our natural gas pipeline system. Information relating to the size and financing of future investments is included in “Item 5. Operating and
Financial Review and Prospects.”
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Available documentation
The SEC maintains an Internet site that contains reports, proxy and information statements, and other
information regarding issuers that file electronically with the SEC and state the address of that site (http:// www.sec.gov). Our internet address is www.tgs.com.ar. This URL is intended to be an inactive textual reference only. It is not intended to be an active hyperlink to our website. The information included in our website or which may be accessed through our
website is not part of this Annual Report, is not incorporated by reference herein or otherwise and should not be relied upon in determining whether to make an investment in any securities issued by us.
B. Business Overview
NATURAL GAS TRANSPORTATION
As a transporter of natural gas, we receive natural gas owned by a shipper, usually a natural gas distributor, at one or more intake points on
our pipeline system for transportation and delivery to the shipper at specified delivery points along the pipeline system. Under applicable law and our License, we are not permitted to buy or sell natural gas except for our own consumption and
to operate the pipeline system. See “—Regulatory Framework” below for more information.
Our pipeline system connects major natural gas fields in southern and western Argentina with distributors and other users of gas in those areas
and the greater Buenos Aires area. TGN, the only other natural gas transportation operating company that supplies the Argentine market, holds a similar license with respect to the northern pipeline system, which also provides natural gas
transportation services to the greater Buenos Aires area.
Natural gas transportation revenues accounted for 41%, 36% and 22% of our total revenues in the years ended December 31, 2025, 2024 and 2023,
respectively. In 2025, 74.2% of our average daily natural gas deliveries were made under long-term firm transportation contracts. See “—Customers and Marketing” below. Natural gas firm transportation
contracts are those under which capacity is reserved and paid for regardless of actual usage by the customer. Almost all of our natural gas firm contracted capacity is currently subscribed for at the maximum tariffs allowed by ENARGAS. During
2025, the amount of revenues derived from natural gas firm transportation contracts was Ps. 567,936 million, representing 81% of the total revenues for the Natural Gas Transportation segment for such year. Substantially all of our remaining
natural gas deliveries were made under natural gas interruptible transportation contracts entered into predominantly with four natural gas distribution companies, power plants and industrial customers. Interruptible contracts provide for the
transportation of natural gas subject to available pipeline capacity. The Government has at times directed us to interrupt supply to certain customers and make deliveries to others without regard as to whether they have natural gas firm or
interruptible contracts. See “—Regulatory Framework—Industry Structure” below for more information.
Expansions of the system. Since 2002, as
a result of the pesification and freezing of natural gas public services tariffs, we lost the ability to invest in the expansion of our transportation system. Consequently, responsibility for system expansion was transferred to fiduciary
structures organized by the Government and financed through tariff surcharges set at values higher than our frozen tariffs.
In February 2017, the Ministry of Mines and Energy called for a national public tender for the purchase of pipelines to extend the natural gas
network in some areas of the Province of Santa Fé, the Patagonian Andes and the coast of the Province of Buenos Aires.
In this context, we entered into a joint venture (Unión Transitoria de Empresas under Argentine Law) (“UT”)
with Sociedad Argentina de Construcción y Desarrollo Estratégico S.A. (“SACDE”), a related company, for the purpose of participating jointly in a National Public Bid —Bid No. 452-0004-LPU17— titled “Assembly of Pipes for the
Construction of the Project: Expansion of the Natural Gas Transportation and Distribution System.” In this regard, the Ministry of Mines and Energy awarded to the UT the construction of the Regional
II-Recreo/Rafaela/Sunchales Regional Gas Pipeline.
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On July 9, 2021, the UT and ENARSA signed a restarting order and a restarting act of the works related to the Sunchales pipeline (the “Sunchales
Work”), by means of which the work schedule was readjusted and ENARSA also assumed the commitment to manage and join efforts to guarantee the cash flow in order to avoid new impacts to the economic-financial structure of the contract of
the Sunchales Work, which would give rise to new requests - on the part of the UT - for the recomposition of the economic-financial equation of the contract and of the execution schedule of the Sunchales Work.
On February 7, 2022, the Secretary of Energy issued Resolution No. 67/2022 creating the “Transport.Ar Producción Nacional” Gas Pipeline System
Program (“Transport.Ar Program”) and declaring the construction of the GPM and complementary works as of public interest. The total investment would be roughly US$3.4 billion, of which 75% were expected to be allocated to the
construction of the pipeline.
By means of Decree No. 76/2022 dated February 11, 2022, the concession of this gas pipeline was granted to ENARSA for a term of 35 years and the
trust FONDESGAS (Fondo de Desarrollo Gasífero Argentino) was created, with Integración Energética Argentina S.A. (“IEASA”) as trustee and beneficiary, and Banco de Inversión y Comercio Exterior
S.A. (a public bank) as trustee. ENARSA can designate a third-party to build, operate and maintain the facility.
The Transport.Ar Program also included the construction of a gas pipeline between the towns of Mercedes and Cardales, the expansion of the final
sections of the gas pipeline in the metropolitan area of Buenos Aires, the reversal of the northern gas pipeline, and the expansion of various sections of the Centro-Oeste gas pipeline, both operated by TGN.
On July 24, 2023, ENARSA completed the expansion works of the NEUBA II Gas Pipeline included in the Transport.Ar Program, adding an incremental
transportation capacity of 7 million cubic meters per day to the Buenos Aires Metropolitan Area. By the end of August 2023, the first stage of the GPM, corresponding to the Tratayén–Salliqueló section, was authorized for operation. The
complementary Mercedes–Cardales gas pipeline was authorized in the last week of November 2023, and the 29-kilometer expansion of the final sections of our system was enabled by late August 2023.
In October 2024, the installation of compressor plants was commissioned allowing the increase of the transportation capacity from its initial
capacity of 11 MMm3/d to 21 MMm3/d.
We are the technical operator of GPM, including its two compressor plants, after ENARSA awarded us the operation and maintenance through a
private tender on June 5, 2023, for a period of 5 years, extendable for up to 12 months. We also serve as the technical operator of the Gasoducto Mercedes Cardales tranche, based on an agreement with a term of 5 years.
In June 2024, we submitted to the Government a private initiative proposal related to the GPM, together with a commitment to make investments in
the regulated natural gas transportation system.
The primary objective of the GPM expansion project is to generate significant foreign currency savings for Argentina by replacing imports of
diesel and liquefied natural gas with natural gas produced in Vaca Muerta, particularly during the winter season, while ensuring domestic supply.
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This project was declared of national public interest and authorized for bidding by ENARSA. On May 22, 2025, ENARSA launched National and
International Public Tender GPM No. 01/2025, which was awarded to us and approved by the Secretariat of Energy on October 17, 2025.
The project comprises: (i) the expansion of the GPM transportation capacity by 14 MMm³/d for which Transportadora de Gas del Sur S.A.–Dedicated
Branch 1 was created in December 2024 to frame this project within the RIGI. The resulting transportation capacity expansion, as specified by Decree No. 54/2025, will be included within the framework of the GPM transportation concession granted
to ENARSA, which, according to the Decree No. 76/2022, was made as provided in the Hydrocarbons Law No. 17,319. The estimated investment for this phase is approximately US$560 million.
We committed to make complementary investments in the regulated natural gas transportation system that we operate, including the construction of
approximately 20 kilometers of pipeline loops and the installation of approximately 15,000 HP of compression capacity on the NEUBA II pipeline, together with other related works and tests aimed at increasing the maximum operating pressure.
These investments, with an estimated cost of approximately US$220 million, are expected to increase transportation capacity in the final sections of the system by approximately 12 MMm3/d.
The works are scheduled to be completed by April 30, 2027. The request for adherence to the RIGI was submitted on October 26, 2025.
In connection with this expansion, during March 2026, the Company carried out the Public Tender No. 1/2026 to award incremental transportation
capacity associated with these works. In such process, the Company received requests exceeding 32 MMm³/d, reflecting demand almost three times higher than the capacity initially offered in this first stage. The requests received were awarded on
April 15, 2026, for an aggregate volume of 5.4 MMm³/d, following the completion of the procedures and time periods required under the public tender. The remaining capacity is expected to be offered and awarded in subsequent stages during the
coming months.
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Customers and Marketing
Our principal service area is the greater Buenos Aires region in central-eastern Argentina. We also serve the more rural provinces of western
and southern Argentina. As of December 31, 2025, our service area contains 5.8 million end users, including 4.1 million customers in the greater Buenos Aires area. Direct service to residential, commercial, industrial and electric power
generation end users is mostly provided by four gas distribution companies in the area, all of which are connected to our pipeline system: Metrogas S.A., Naturgy Argentina S.A., Camuzzi Gas Pampeana S.A. and Camuzzi Gas del Sur S.A. These
natural gas distribution companies serve, in the aggregate, 66% of the natural gas distribution market in Argentina. The other five Argentine distribution companies are located in and serve northern Argentina and are not connected directly to
our pipeline system.
The table below contains certain information for the year ended December 31, 2025, as it relates to the distribution companies that are
connected to our pipeline system:
Company Annual deliveries (MMm3) Volume of market served (in %) No. of end users (in millions) Deliveries received from us (in %)
Metrogas (1) 5.9 21 2.4 85
Camuzzi Pampeana (1) 5.1 18 1.1 87
Camuzzi Sur 4.6 16 0.6 100
Naturgy Argentina (1) 3.3 11 1.7 67
66 5.8
(1) Also connected to the TGN system.
Source: ENARGAS
The firm average contracted capacity for our four largest distribution customers, Pampa Energía and for all other customers, as a group, as of
December 31, 2025, 2024 and 2023, together with the corresponding net revenues derived from natural gas firm transportation services during such years and the net revenues derived from interruptible services during such years are set forth
below:
For the years ended December 31,
2025 2024 2023
Average firm contracted capacity (MM3/d) Total net revenues (millions of pesos) Average firm contracted capacity (MM3/d) Total net revenues (millions of pesos) Average firm contracted capacity (MM3/d) Total net revenues (millions of pesos)
Metrogas 16.7 174,486 16.7 149,465 16.7 69,664
Camuzzi Pampeana 15.6 128,717 15.6 110,945 15.5 51,765
Naturgy Argentina … 11.8 105,363 11.8 90,477 11.8 42,147
Camuzzi Sur 12.1 37,786 10.8 26,910 10.8 12,855
Pampa Energía 3.6 29,318 3.7 22,477 3.2 9,914
Others 29.4 229,454 24.9 180,022 25.1 97,406
Total 89.2 705,124 83.5 580,296 83.1 283,751
We play a leading role in the natural gas industry in Argentina and satisfy 80 direct customers and 5.8 million indirect customers for the year
ended December 31, 2025.
As of December 31, 2025, the total contracted firm or “take or pay” capacity by costumers was 89.4 MMm3/d with a weighted average life of approximately 11 years.
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Pipeline Operations
Pipeline Deliveries.
The following table sets forth our average daily natural gas firm and interruptible transportation deliveries for 2025, 2024 and 2023:
For the year ended December 31,
2025 2024 2023
Firm: Average daily deliveries (MMm3/d) Average daily deliveries (MMm3/d) Average daily deliveries (MMm3/d)
Metrogas 11.5 11.4 10.9
Camuzzi Pampeana 9.8 9.6 10.5
Camuzzi Sur 8.1 7.3 7.4
Naturgy Argentina 6.5 7.1 6.5
Others 19.1 15.6 14.5
Subtotal firm 55.1 50.9 49.8
Subtotal interruptible 19.1 18.8 17.0
Total 74.2 69.5 66.8
Average annual load factor (1) 83 % 83 % 80 %
Average winter heating season load factor (1) 86 % 84 % 90 %
(1) Average daily deliveries for the period divided by average daily firm contracted capacity for the period, expressed as a percentage.
During 2025, the daily average natural gas injection to the pipeline system operated by us amounted to 86.4 MMm³/d. Such volume includes
contributions from the Austral, San Jorge Gulf and Neuquén basins and from GPM at its access to the regulated transportation system in Salliqueló. Transportation through the GPM was of an average 16.1 MMm³/d, representing a 39% increase
compared to 2024.
In 2025, the contribution of the Neuquén Basin was 0.8% above the volume supplied the previous year, mainly due to higher gas transportation
capacity from the Vaca Muerta field facilitated by the GPM pipeline.
As opposed to the previous year, the southern basins of Argentina increased their injection levels. Although the Chubut and Santa Cruz fields
are going through their natural decline stage, the Austral basin recorded a significant increase, from an average of 15.8 MMm³/d to 20.7 MMm³/d, owing to the Fénix project. Consequently, such increase not only offset the fields’ natural decline
but also boosted the total injection of the south, which went up by 2.7 MMm³/d.
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The chart below shows the main operating data for the natural gas transportation segment.
Natural Gas Transportation System Improvements. In 2025, 2024 and 2023, we made capital expenditures aimed at enhancing of our natural gas transportation system’s safety and reliability. We operate our pipeline system and the pipeline constructed pursuant to the
Gas Trust in accordance with Argentine natural gas transmission safety regulations, which are substantially similar to U.S. federal regulations. Based on the pipeline inspection reports we have received to date and the current operation of
the pipeline system, we do not foresee any significant safety risks that could not be managed at a low level. In order to identify changes in the safety regulations that our pipeline system has to comply with, we conduct inspections for the
purpose of detecting increases in the population density in the areas through which our pipeline system extends. Changes in population densities may require us to increase safety measures in certain sections of the system.
The “greater” Buenos Aires area comprises the City of Buenos Aires and its surrounding area. One end of our natural gas transportation system is
located in the greater Buenos Aires area, where we transfer natural gas for further delivery to major natural gas distribution companies.
System Improvements. In
2025, 2024 and 2023, our pipeline system satisfactorily met the demands generated by the winter season and the requirements of ENARGAS. To that effect, we carried out several maintenances, prevention and inspection works.
During 2025, we carried out in-line inspections along 1,200 km of pipelines and direct integrity assessments, such as Close Interval Surveys
(CIS) and Direct Current Voltage Gradient (DCVG) surveys, over 220 km, with the aim to identify and control threats to integrity, such as external corrosion, geometrical defects, construction anomalies and recoating failures, among others.
As for our recoating program, in the reported year we executed recoating replacements in 8.4 km of pipelines and we made progress in recoating
works at three valve facilities along the San Martín pipeline in the province of Buenos Aires. These tasks seek to mitigate the risk of external corrosion and/or Stress Corrosion Cracking (SCC), besides surveying and correcting anomalies that
might evolve and affect the service, thus extending the useful life of our facilities.
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To strengthen integrity in high population density areas, we conducted filling works in reinforcement sleeves, reducing their exposure to
damage. We additionally completed 785 km of inline inspection with EMAT technology to detect cracking.
Our assets integrity team carried out a campaign to assess 28 defects (external corrosion. geometric defects, anomalies in welding) and
completed 35 repairs with reinforcement sleeves and 48 pipelines replacements, many of them in simultaneous interventions to minimize impact on the system. We also assessed the integrity of 31 bypasses in sections of the province of Buenos
Aires.
Regarding cathodic protection, we reinforced reliability by means of the installation of a new unit, 13 current reinforcement lenses and the
upgrading of 16 facilities that were technologically obsolete. We additionally reconditioned compressor plants, added three reinforcements and conducted specific surveys at three plants. At the Cerri Complex and Galván Plant, we installed seven
reinforcements and renovated three facilities.
All the above mentioned works in this section are aimed at ensuring business continuity and our facilities’ integrity, underlining our
commitment to safety and the care of people and the environment, all main cornerstones in rendering a reliable public service.
With the purpose of raising awareness among the community, we increased our facilities’ signaling and conducted virtual and presence-based
damage prevention activities, including campaigns in the media and networks, radio broadcasting and meetings with municipalities and ground-breaking companies in the provinces of Buenos Aires, Neuquén and Rio Negro.
On the topic of the technological update of our systems, we completed the integration of the Belisle and Cervantes compressor plants to the
operative center of the City of Buenos Aires, which have joined the Olavarría and Saturno plants in the pursuit of a sustained digital transformation process and the adaptation to a new remote assets maintenance and operations philosophy, based
on data.
We started the adjustment of the control system dashboards of the 3 turbocompressors of the Gaviotas Compressor Plant. Additionally, in 2026 we
will add to our tasks the development of the control system and the electricity generation system of the plant.
We have completed the upgrading and integration of the vibration monitoring systems of the Olavarría and Ordoqui plants to the Bentley Nevada
centralized system. Pursuant our upgrading schedule, in 2026 we will continue with the Fortín Uno, Barker y Chelforó compressor plants.
In the field of operative safety, we have concluded the extended basic engineering for the control systems upgrading at the Chelforó, La Adela,
Saturno and Fiat plants. Procurement of materials has already started at the Chelforó, La Adela, Saturno plants. This upgrading plan seeks to mitigate technological obsolescence of assets and guarantee the required reliability standards to
pursue our strategy on transportation systems’ remote operation.
Pursuant our assets upgrading plan, we have prioritized the modernization of the auxiliary systems in order to strengthen the operative
reliability of the plants. In 2025, we acquired new compressor units and dryers. This project phase included their provision for the compressor plants of San Antonio, Piedra Buena, Barker, Magallanes, San Julián, Fortín Uno, Chelforó, Dolavon
and Bajo Gualicho. The main goal of this renovation is to ensure reliability and maintain air quality in accordance with operative standards. We are also updating control systems and fuel charts at Fortín Uno and Belisle compressor plants. In
2025, we completed the engineering stage and the partial procurement of materials. The physical intervention of units has been scheduled for 2026.
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We upgraded the oil air coolers of one of the turbines belonging to the Solar Compressor Plant. This improvement seeks to ensure the
availability and the adequate functioning of the unit during high-regime periods and extreme temperatures.
On the topic of environmental care, we finalized the assembling of biodigester systems at 11 compressor plants: San Antonio, Conesa, Magallanes,
Moy Aike, Piedra Buena, San Julián, Río Seco, Bosque Petrificado, Pico Truncado, Garayalde and Dolavon. The biodigesters adjustment and installation plant is planned to be executed in 2026.
Within the framework of our Emissions Reduction Plan, after concluding the campaign to detect and quantify natural gas leakages emissions, we
have moved forward to the ensuing mitigation stage. To comply with this plan, in 2025 we acquired 46 valves with technological improvements to replace assets and eliminate leakages, which were distributed at different facilities.
Works at Liquids Facilities
Pursuant to our corporate goals on safety, reliability and operative efficiency, in this year we executed key initiatives at the Cerri Complex,
the Galván Plant and transversal areas. These actions consolidated our business sustainability and strengthened the competitiveness of our operations.
Cerri Complex
During 2025, we implemented significant improvements focused on strengthening the safety and integrity of critical assets. In the field of
industrial safety, we upgraded the fire extinguishing system through the integral replacement of pipes and the addition of a new water curtain cooling system for the cryogenic plant ovens, improving contingencies protection standards. With
respect to regulatory compliance, we adapted spheres 2 and 3 and McKee tanks to ensure their compliance with standards in force. Finally, to preserve the integral structure and extend the useful life of the units, we conducted interventions in
the legs of the spheres.
Galván Plant
With the purpose of enhancing operations, we replaced two critical lines for refrigerated products that were under inspection due to their width
and we implemented improvements to increase flexibility at MEGA-TGS transfers, boosting response capacity in the face of demand variations. With respect to compliance to standards, we adapted sphere 9 to meet regulatory standards.
Transversal Projects
With business sustainability and profitability in mind, we developed projects that maintain production stability throughout the whole year,
including during high temperature periods. We also made progress in addressing obsolescence through the substitution of mass flow meters at the absorption plant, ensuring accuracy in the measurement and mitigating operative risks.
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These actions underscore our commitment to industrial safety, operative excellence and the creation of sustainable value, ensuring processes
reliability and market competitiveness.
Works at Vaca Muerta Facilities
During the year we finalized the installation and startup of the second conditioning module of the Propak Plant, which allowed us to
significantly expand the plant capacity. This work constitutes a milestone in the consolidation of the Vaca Muerta system infrastructure, raising the total plant capacity to 28 MMm³/d.
To support Vaca Muerta’s system sustained growth, we conducted expansion works at the inflow facility. We also completed the installation of a
third module of condensate stabilizers, which strengthens the plant capacity to process higher volumes and ensures the quality enhancement of the final product.
Technical Assistance Services Agreement. As part of its bid to purchase a 70% interest in us from the Government, CIESA was required to have an investor-company with experience in natural gas transmission that would serve as our technical operator. In late 1992,
we entered into a Technical Assistance Agreement with PEPCA (the “Technical Assistance Agreement”), an indirect, majority-owned subsidiary of Enron Corp. The term of the Technical Assistance Agreement was for eight years from December
28, 1992, renewable automatically upon expiration for an additional eight-year term and was assigned to Petrobras Argentina S.A. (“Petrobras Argentina”) as part of a master settlement agreement. Since July 2004, Petrobras Argentina was
our technical operator and was in charge of providing assistance related to, among others, the operation and maintenance of the natural gas transportation system and related facilities and equipment in order to ensure that the performance of
the system is in conformity with international natural gas transportation industry standards and in compliance with certain Argentine environmental standards.
On July 27, 2016, Petrobras Argentina was acquired by Pampa Energía. For further information, see “Item 7.
Major Shareholders and Related Party Transactions—A. Major Shareholders.”
With the prior approval of ENARGAS and our Board of Directors, in December 2017, we and Pampa Energía agreed to a technical, financial and
operational assistance service agreement (the “SATFO”) for a three-year term. The SATFO substantially contains the same terms as the Technical Assistance Agreement, as amended. However, the scope of the contract was extended to include a
greater number of services that Pampa Energía must render us. Any amendment, assignment or even termination of the SATFO has to be authorized by ENARGAS. Pursuant to the SATFO, the currency for the technical assistance fee paid to Pampa Energía
is U.S. dollars. Our Audit Committee analyzed the SATFO and concluded that its price is on market terms.
The SATFO sets out the services to be provided by Pampa Energía to us, at the request of our Chief Executive Officer. Between December 2017 and
October 2019, we received from Pampa Energía technical, financial and operational assistance and we paid a monthly fee for such services in amounts equal to the greater of (i) US$3 million and (ii) an amount equal to 7% of the difference
between our net income before interests and income taxes of the most recently ended twelve-month period and US$3 million.
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The services provided by Pampa Energía to us under the SATFO include assisting us in the following matters to the extent that they arise in the
ordinary course of business: (i) replacement, repair and renovation of facilities and equipment to ensure that the performance of the system is in accordance with international gas transportation industry standards; (ii) preparation of
performance evaluations, operating cost analysis, construction assessments and advice related to budget control; (iii) advice regarding safety, reliability and efficiency of system operation and gas industry services; (iv) advice regarding
compliance with applicable laws and regulations relating to safety and industrial hygiene, pollution and environmental protection of the system; (v) routine and preventive maintenance of the system; (vi) staff training; (vii) design and
implementation of the necessary procedures to provide with the aforementioned services; (viii) financial and insurance advice; (ix) advice on operational improvements such as risk analysis, generation and commercialization of electric energy,
operative management of the “midstream,” human resources management, and legal and supply management; (x) advice on non-regulated businesses such as midstream, electric, petrochemical, processing, and construction, among others; and (xi) design
and implementation of all major aspects of natural gas transportation and liquids production, as well as administrative information and control system to adequately inform our management group.
Our Board of Directors, at its meeting held on September 17, 2019, approved a proposal for Pampa Energía, as technical operator of the SATFO,
for a significant reduction in the compensation it receives under the SATFO. The general and special shareholders meeting held on October 17, 2019, ratified such proposal. The Audit Committee also expressed its favorable opinion to such
proposal, as required by the Capital Markets Law No. 26,831 (“Capital Markets Law”), because Pampa Energía is our related party.
According to such amendment, we extended the term of the SATFO until December 27, 2024 (automatically renewable for three more years) and
replaced the provisions relating to the calculation of the fee payable to Pampa Energía. Pursuant to the amended SATFO, the monthly fee payable to Pampa Energía shall be equal to the greater of: (i) US$0.5 million or (ii) the variable
compensation that arises from applying to comprehensive income before results and income taxes for the year but after deducting also the above fixed amount) the following scheme:
From 12/28/2019 to 12/27/2020: 6.5 %
From 12/28/2020 to 12/27/2021: 6.9 %
From 12/28/2021 to 12/27/2022: 5.5 %
From 12/28/2022 to 12/27/2023: 5.0 %
From 12/28/2023 to 12/27/2024 and onwards: 4.5 %.
For the year ended December 31, 2025, we recorded a charge of Ps. 32,931 million for services rendered by Pampa Energía pursuant to the amended
SATFO.
The Argentine Natural Gas Industry
Historical Background.
Prior to the privatization of GdE, the Argentine natural gas industry was effectively controlled by the Government.
In 1992, the Natural Gas Law was passed providing for the privatization of GdE. The Natural Gas Law and the related decrees provided for, among
other things, the transfer of substantially all of the assets of GdE to two natural gas transportation companies and eight distribution companies. Currently there are nine authorized companies to distribute natural gas in Argentina. The ninth
concession was added in 1998 and covers the Mesopotamian provinces, Formosa, Chaco, Entre Rios and Misiones which previously had no network for natural gas service. The license for the Mesopotamian region was awarded to GasNea S.A. The
transportation assets were divided into two systems on a broadly geographical basis, the northern and southern trunk pipeline systems, designed to give both systems access to natural gas sources and to main centers of demand, including the
greater Buenos Aires area. As a result of the division, our natural gas transportation system is connected to the two natural gas distribution systems serving the greater Buenos Aires area, one serving Buenos Aires Province (excluding the
greater Buenos Aires area and the northeast of this province) and one serving southern Argentina. TGN is connected to five distribution systems serving northern Argentina. TGN is also connected to the natural gas distribution systems serving
the greater Buenos Aires area and, to a limited extent, the natural gas distribution system serving Buenos Aires Province (excluding the greater Buenos Aires area). In the two instances where we are directly connected to a natural gas
distribution system with TGN, we are the principal supplier of natural gas transportation services.
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The Natural Gas Law and the related decrees granted each privatized natural gas transportation company a license to operate the transferred
assets, established a regulatory framework for the privatized industry based on open, non-discriminatory access, and created ENARGAS to regulate the transportation, distribution, marketing and storage of natural gas. The Natural Gas Law also
provided for the regulation of wellhead gas prices in Argentina for an interim period. Prior to deregulation, the regulated price was set at US$0.97 per million British thermal units (MMBtu) at the wellhead, which had been the regulated
price since 1991. Pursuant to Presidential Decree No. 2,731/93, gas prices at the wellhead were deregulated as of January 1, 1994, and, from that date until the year 2002, the average price of gas increased.
In spite of the devaluation of the peso in 2002, increases in wellhead natural gas prices were limited until 2004. From May 2004 until August
2005, wellhead gas prices increased in a range from 105% to 180% (depending on the gas basins) for power plants, industries and large businesses. These adjustments were complemented by lower increases in the price of natural gas for CNG
vehicles.
In November 2020, the Argentine Government implemented the Plan Gas.Ar through Decree No. 892/2020, later extended until 2028 by Decree No.
730/2022. The Plan Gas.Ar was designed to encourage investment in natural gas exploration and production by establishing incentive prices and guaranteed demand through competitive bidding processes. Under this framework, natural gas producers
entered into supply agreements with distributors, sub‑distributors and Compañía Administradora del Mercado Mayorista Eléctrico S.A. (“CAMMESA”), with prices referenced to the Point of Entry to the Transportation System (“PIST”).
Between 2020 and 2022, several bidding rounds were conducted under the Plan Gas.Ar, resulting in long‑term supply commitments primarily from the
Neuquén Basin, which by 2021 accounted for approximately 60% of Argentina’s natural gas production. Subsequent bidding rounds extended existing commitments and incorporated incremental production projects in the Austral and Northwest basins,
reinforcing supply during peak winter demand periods.
In parallel with production incentives, the Government addressed structural infrastructure constraints. In February 2022, the Secretariat of
Energy created the “Transport.Ar Producción Nacional” program through Resolution No. 67/2022, declaring the construction of the GPM and its complementary works to be of national public interest. By Decree No. 76/2022, the transportation
concession for the GPM was granted to IEASA for a term of 35 years, and the FONDESGAS trust was created to finance the project.
The first stage of the GPM, connecting Tratayén in the Neuquén Province with Salliqueló in the Buenos Aires Province, was authorized for
operation in August 2023. Complementary works, including the Mercedes–Cardales pipeline and expansions of final sections of our system, were authorized between August and November 2023. In October 2024, additional compressor plants were
commissioned, increasing the transportation capacity of the initial GPM section from 11 million cubic meters per day to 21 MMm3/d.
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We currently act as the technical operator of the GPM, including its compressor facilities, pursuant to an operation and maintenance agreement
awarded by ENARSA in June 2023. We also act as technical operator of the Mercedes–Cardales pipeline under a separate agreement.
The decline in natural gas imports from Bolivia prompted the Government to advance the reversal of the Northern Gas Pipeline, enabling the
transportation of natural gas from Vaca Muerta to northern and northwestern regions of Argentina. As part of this initiative, in November 2024 the Government inaugurated the Tío Pujio–La Carlota pipeline, which interconnects the Central and
Northern pipeline systems. Additional works, including compressor automation and pipeline looping, are expected to be completed during 2025.
In December 2023, Decree No. 55/2023 declared a state of emergency in the national energy sector and provided for the intervention of ENARGAS
starting January 1, 2024. The tariff review process initiated under this framework was extended through July 9, 2026, by Decree No. 370/2025.
In June 2024, we submitted a private initiative proposal to the Ministry of Economy aimed at expanding natural gas transportation capacity by
approximately 14 million cubic meters per day. The project was declared of national public interest and authorized for bidding. On May 22, 2025, ENARSA launched National and International Public Tender GPM No. 01/2025, which was awarded to us
and approved by the Secretariat of Energy on October 17, 2025.
Natural Gas Demand.
Natural gas consumption in Argentina has played a significant role in the energy industry in recent years, reaching more than 52% of total national energy consumption, which is greater than the comparable percentage for worldwide energy
consumption.
In 2025, natural gas consumption reached 138 MMm3/d, above the volume recorded in 2024, which had been of 137 MMm³/day. This variation
represents a 0.6 % year-on-year increase. Such growth was mainly attributable to a higher demand from thermal power plants–benefited from more natural gas availability for power stations- and to higher volumes for export. On the other hand,
priority demand remained at levels similar to the previous year
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The graphic below illustrates the breakdown of natural gas consumption in Argentina in 2025 and 2024 by type of consumer:
Source: ENARGAS
Beginning in 2003, a sharp increase in natural gas demand occurred as a consequence of: (i) the recovery of certain industries in the Argentine
economy in 2003, (ii) the 2002 devaluation of the peso as well as the transportation and distribution tariffs and the elimination of both tariff and wellhead gas price adjustments, making this fuel relatively inexpensive for consumers as
compared to other types of fuel, the prices of which are affected by inflation, (iii) the growth of GDP between 2003 and 2013 and (iv) the energy policy that seeks to be one of the main producers of natural gas that allows not only to replace
the import of natural gas but also to generate the necessary resources for its export. As a result, natural gas became, by far, the cheapest fuel in Argentina and high rates of substitution of natural gas for other fuels in industry, power
plants and vehicles have been observed. Likewise, the rising demand for gas has also been based on the recovery of many industrial segments of the Argentine economy, and the lack of availability of natural gas to meet current demand represents
a challenge for continued industrial growth at the rates achieved in recent years.
The demand for natural gas in Argentina is highly seasonal, with natural gas consumption peaks in winter. The source of seasonal changes in
demand is primarily residential consumers. In order to bridge the gap between supply and demand, especially with respect to peak-day winter demand, the Government has entered into several natural gas import agreements.
The most important agreement was signed with the Bolivian government in June 2006 and amended in May 2010 and July 2012. The agreement provides
for the import of natural gas from Bolivia to Argentina to be managed by IEASA to deal with the decrease in domestic natural gas production and in an effort to maintain supplies at similar levels to the previous years. During 2022, the sixth
addendum to the Bolivian import contract came into force, which modifies the price formula and, due to the decline in Bolivian fields, reduces supply volumes. The seventh addendum to the gas import contract between ENARSA and YPFB (Yacimientos
Petrolíferos Fiscales Bolivianos) was signed on December 30, 2022, and includes a reduction in the volume of natural gas that will be received. In October 2023, this contract was modified and Bolivia ceased to supply Argentina with firm natural
gas on July 31, 2024.
In the winter of 2025, average temperatures of 14.0 °C were recorded, slightly higher than the ones logged in the same period of 2024 (13.3 °C).
This accounts for the fact that residential and SMEs demand maintained similar levels to the volumes corresponding to the previous year. The 2025 winter was the first complete period that could rely on Perito Moreno pipeline full transportation
capacity, reaching 21 MMm³/d, which meant higher local natural gas availability. Therefore, exports were maintained even in winter months, mainly to Chile through the Gas Andes pipeline, as such dispatch did not affect supply to the domestic
market, given the current design of the transportation infrastructure.
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Thanks to the incentive scheme proposed by the Plan Gas.Ar and the increase in transportation capacity with the commissioning of the
Tratayén—Salliqueló pipeline in 2023, production levels have increased, continuing this trend throughout 2025. This greater availability of local natural gas allows for sustained exports, mainly to Chile through the Gas Andes pipeline, even
during the winter months, taking advantage of the fact that the shipment of these volumes would not restrict supply in the domestic market given the current design of the transportation infrastructure.
Regarding variations against 2024, which can be seen in the graph below, in May 2025 priority demand recorded a lower consumption than in 2024,
with an average difference of 15.6 MMm³/d, followed by a significant upturn in June. Unlike the previous year, low temperatures were recorded as from the month of June, which generates a major gap in priority demand when comparing the months of
May and June.
With regard to power plants, variations against the previous year are accounted mainly by the monthly average temperatures. Elevated consumption
is observed in January and February when high temperatures channeled consumption to power plants and a marked decrease towards the last months of the year, compared to 2024.
Concerning exports, the greater gas availability recorded in the reported year, compared to 2024, was translated into a positive variation in
exported volumes.
The following graph shows the monthly consumption in 2025 in MMm3/d
for each of the demand sectors, compared to the total demand in 2024.
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Gas Supply. There are
24 known sedimentary basins in the country, 12 of which are located entirely onshore, six of which are combined onshore/offshore and eight of which are entirely offshore. Production is concentrated in five basins: Norwest in northern
Argentina, Neuquén and Cuyo in central Argentina, and San Jorge Gulf and Austral in southern Argentina. In 2025, 70% of the natural gas transported by our system originated in the Neuquén Basin with the remainder coming primarily from the
Austral basin and the re-gasifying LGN tanker located in Bahía Blanca. Our pipeline system is connected to the Neuquina, Austral and San Jorge Gulf basin. We are not connected to the Cuyo or Northwest basin.
The graph below shows the evolution of gross natural gas production by basin from 2015 to 2025 in MMm3/d:
Source: Secretary of Energy
In 2025, natural gas imports were maintained as a complementary resource to meet demand peaks and ensure supply to critical areas.
Pipeline imports from Bolivia went down by over 80% in a year-on-year basis, reaching marginal levels throughout the whole year. Supply was
concentrated in winter peaks and in some cases under spot agreements implemented by private parties to supply Argentine North West power plants. Daily records ranged from 0.9 to 3.2 MMm³/day.
LNG imports at the Escobar terminal were carried out by ENARSA, which assigned 24 shipments for winter. The maximum daily volumes reached 16.6
MMm3/d in the month of June. The decrease compared to the previous year reflects greater supply from Vaca Muerta and the strategy to minimize import purchases.
The drop in imports (-14.8% in LNG and -81.3% in pipeline gas) can be explained by the increase in local production (Vaca Muerta), improvements
in infrastructure and moderation in demand.
Total local gas injection in June 2025, highest peak in the year, reached 151 MMm3/d, compared to the 143 MMm3/d recorded in August 2024. Thus,
the reported year injection showed an 8 MMm3/d increase with respect to the highest volume recorded in 2024, and a 18 MMm3/d increase with respect to the injection recorded in 2023.
In a breakdown analysis of natural gas operators, in 2025 Total Austral S.A. ranked as the main gas producer in Argentina with a share of 24% of
the total national production, followed by YPF with 23%.
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Source: Secretary of Energy
The Neuquén Basin has the largest total natural gas injection, while the remaining basins continue with their natural decline (including
Bolivia), which made the construction of a third trunk pipeline imperative to evacuate the incremental gas associated with the development of reserves in the Neuquén Basin.
In recent years, there have been no requests from potential parties interested in contracting additional capacity, mainly due to the lack of gas
and the gradual declines of conventional fields, especially from the reception areas of Tierra del Fuego, Santa Cruz and Chubut. This situation was not the same with respect to the Neuquén Basin where the natural gas from the unconventional
fields of Vaca Muerta, as from the Plan Gas.Ar, has boosted production in that region, completing the transportation capacity from that basin, making necessary and essential the expansion of the gas pipeline system that allows exploiting the
energy potential available in Vaca Muerta.
Thus, by the end of August 2023 the first stage of the GPM (Tratayén- Salliqueló section), which was executed by ENARSA, was enabled. Its
complementary works, namely, the Mercedes - Cardales gas pipeline was enabled in the last week of November 2023 and the extension of 29 km over the final sections of our pipeline was already enabled by the end of August 2023. In October 2024,
the installation of the compressor plants that raise the transport capacity of this first section to 21MMm3/d was completed.
The Vaca Muerta formation, located in the Neuquén Basin, is considered one of the most prominent shale plays
globally, and is the world second-largest shale gas development after the U.S. Permian Basin. The development of the Vaca Muerta
formation plays an important role in the Argentine economy, and therefore the national and provincial governments have introduced changes to the regulatory framework for exploration and production of unconventional hydrocarbons, in order to
attract investments.
Since 2018, when we first set foot in Vaca Muerta, our strategy has focused on being a leading company in the provision of
integrated services and a key player in the energy development of Argentina and the region. Our conditioning plant in Tratayén is a groundbreaking project that contributes to this energy growth.
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Distribution of the Vaca Muerta Formation in the Basin and our infrastructure
Source: Internal information
Vaca Muerta is no longer at an early exploratory stage, but rather in a phase of large-scale development,
although it remains less mature than major unconventional plays in the United States and Canada. In this regard, the Permian Basin
continues to be a relevant geological and operational benchmark for Vaca Muerta, given similarities in reservoir characteristics, while differing substantially in terms of infrastructure scale, capital availability and market access.
In recent years, Vaca Muerta has shown sustained growth in activity and production, reaching record levels of
drilling and completion operations and consolidating its role as the main source of natural gas and crude oil production in Argentina
According to data from official sources and international energy agencies, the Neuquén Basin—driven primarily
by Vaca Muerta—currently accounts for more than 70% of Argentina’s natural gas production and a significant share of its oil output.
Despite this progress, the pace and scale of future development in Vaca Muerta will continue to depend on the
expansion of transportation infrastructure, access to domestic and export markets, and the stability of the regulatory and macroeconomic framework. Based on recent projections by international energy agencies, including the International
Energy Agency and the U.S. Energy Information Administration, Argentina’s technically recoverable shale gas resources rank among the largest globally. Production from the Neuquén Basin could reach levels in the order of 140–150 million cubic
meters per day toward the end of this decade, with higher production levels dependent on the timely expansion of transportation infrastructure and export facilities, as well as on regulatory and macroeconomic stability.
Neuquén Basin. The
largest natural gas basin and the major source of natural gas supply for our system is the Neuquén Basin, located in west central Argentina. Since the discovery of Vaca Muerta formation, this basin is the
most prolific basins of the country accounting approximately 72% of natural gas production in the country.
Since then, the development of non-conventional gas in the Province of Neuquén has played a leading role in the increase in production of
natural gas.
During 2025, natural gas production in the Neuquén Basin increased by 0.8% with respect to 2024, while natural gas production in the remaining
Basins declined.
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During 2025, natural gas production in Vaca Muerta consolidated its role as the main source of gas supply in Argentina. According to official
data published by the Argentine Secretariat of Energy and international energy agencies, production from the Neuquén Basin—driven primarily by Vaca Muerta—accounted for more than 60% of Argentina’s total natural gas output during the year, with
national production reaching record levels during peak winter months. Average national gas production exceeded 120 MMm3/d toward the end of 2025, while maximum daily production surpassed historical records during the winter season.
The growth in gas production was supported both by continued development of shale gas resources and by a significant increase in associated gas
volumes linked to the expansion of shale oil production in Vaca Muerta. International energy agencies have highlighted that Vaca Muerta currently explains more than 70% of Argentina’s natural gas production and has been instrumental in
offsetting the natural decline of conventional gas fields.
The most significant operators in Vaca Muerta’s natural gas segment include YPF, Tecpetrol S.A., TotalEnergies and Pan American Energy. Fortín
de Piedra, operated by Tecpetrol, remained the largest unconventional gas field in Argentina during 2025 and continued to play a central role in meeting domestic demand, particularly during periods of peak seasonal consumption.
The TGN system also accesses the Neuquén Basin. Of the transported natural gas coming from the Neuquén Basin, approximately 65% was transported
by us and approximately 35% by TGN for the year ended December 31, 2025.
Undoubtedly, the biggest challenge in this Basin, given the potential of Vaca Muerta, is to develop the appropriate infrastructure for the
transportation of natural gas. In this sense, in 2018 we have carried forward the construction of the Vaca Muerta Norte and Sur gas pipeline and the Tratayén conditioning plant with its subsequent expansions. In this sense, the beginning of the
GPM works is particularly important. For additional information see “—The Argentine Natural Gas Industry” above.
Austral and San Jorge Basins. Natural gas provided by these basins, located in the southern region of Argentina, was transported mainly by us (Camuzzi Gas del Sur S.A. also transports natural gas through regional pipelines). In the Austral basin,
exploration has centered in and around the basin’s existing natural gas fields and on other fields located offshore. The San Jorge basin is primarily an oil-producing basin.
Under the framework enacted by the Government to promote investments after the issuance of Decree No. 929/2013, in 2014, a joint operation was
formed by Wintershall Energía S.A., Total Austral S.A. and Pan American Energy LLC Sucursal Argentina for the investment of US$1,000 million in off-shore gas fields (Vega Pleyade) located in the Tierra del Fuego region.
The governments of the provinces on which these basins are located, together with the Government, have taken several measures to develop
nonconventional gas and off-shore sites. During May 2019, the Government granted exploration rights to 13 companies over three off-shore basins.
In addition, ENAP Sipetrol Argentina S.A., YPF and IEASA signed an agreement to explore and develop offshore fields in the continental shelf of
Argentina, and on September 5, 2019, Secretary of Hydrocarbon Resources issued Resolutions No. 524 and 525, which granted an eight-year exploration permit on off-shore areas to Shell Argentina S.A. and QP Oil and Gas S.A.U.
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In 2022, Total Austral announced an investment of approximately US$700 million for the development of the offshore Fénix gas project, located
off the coast of Tierra del Fuego. The project comprises the installation of a new offshore production platform and the construction of approximately 35 kilometers of subsea pipelines connecting the Fénix field to the existing Vega Pléyade
platform, whose production has been in natural decline.
The Fénix project commenced production in September 2024 and reached its designed production capacity in early 2025, following the start‑up of
its three horizontal wells. At plateau, the project produces approximately 10 million cubic meters of natural gas per day, representing around 8% of Argentina’s total natural gas production. The gas produced at Fénix is transported through the
subsea pipeline system, treated at onshore facilities in Río Cullen and Cañadón Alfa, and injected into the national transportation system.
The development of the Fénix project has contributed to sustaining gas production levels in the Austral Basin and to reducing the need for
liquefied natural gas imports during peak seasonal demand periods.
The map below illustrates the distribution of the gas basins in Argentina:
Regulatory Framework
Industry Structure.
The legal framework for the transportation and distribution of natural gas in Argentina is comprised by the Natural Gas Law, Decree No. 1,738/92, other regulatory decrees (primarily Decree No. 2255/92, which includes the Basic Rules for
Transportation Licenses and Regulations of the Transportation Services), the Pliego, the transfer agreements and the licenses of the newly privatized companies. The Hydrocarbons Law of Argentina regulates the midstream natural gas industry,
under a competitive and partially deregulated system. The Public Emergency Law and related laws and regulations, which are no longer in effect, significantly altered the regulatory regime under which we operated since 2002. Notwithstanding
this, in December 2019 the national congress passed the Solidarity Law that introduced certain modifications to the RTI concluded in March 2018 with the issuance of Decree No. 250/2018 by the Executive Branch. See “Item 3. Key Information—D. Risk Factors—Risks Relating to Our Business.”
Natural gas transportation and distribution companies operate in an “open access,” non-discriminatory environment under which producers and
certain third parties, including distributors, are entitled to equal and open access to the transportation pipelines and distribution system in accordance with the Natural Gas Law, applicable regulations and the licenses of the privatized
companies. In addition, a regime of concessions under the Hydrocarbons Law of Argentina is available to holders of exploitation concessions to transport their own natural gas production.
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The Natural Gas Law prohibits natural gas transportation companies (TGN and us) from also being merchants in natural gas. In addition, (i)
natural gas producers, storage companies, distributors, and consumers who contract directly with producers may not own a controlling interest (as defined in the Natural Gas Law) in a transportation company; (ii) natural gas producers, storage
companies and transporters may not own a controlling interest in a distribution company; and (iii) merchants in natural gas may not own a controlling interest in a transportation or distribution company.
Contracts between affiliated companies engaged in different stages in the natural gas industry must be approved by ENARGAS, which may reject
these contracts if it determines that they were not entered into on an arm’s-length basis.
ENARGAS, which was established by the Natural Gas Law, is an autonomous entity responsible for enforcing the provisions of the Natural Gas Law,
the applicable regulations and the licenses of the privatized companies. Under the provisions of the Natural Gas Law, ENARGAS is required to be governed by a board of directors composed of five full-time directors appointed by the Executive
Branch subject to confirmation by the Argentine Congress. However, from 2004 to 2007, ENARGAS was governed by three directors who were not confirmed by the Argentine Congress, and, since 2007 until January 2018, ENARGAS has been administered by
an intervention inspector appointed by the Executive Branch. On January 31, 2018, the Executive Branch appointed a President for ENARGAS for a five-year term, thereby concluding the intervention period. However, the Solidarity Law established a
new intervention of ENARGAS. Thus, from March 17, 2020 to December 31, 2023, ENARGAS underwent intervention. On December 16, 2023, Decree No. 55/2023 was issued, declaring a state of emergency in the national energy sector until December 31,
2024. Among other provisions, this decree intervenes in ENARGAS from January 1, 2024, and instructs the Ministry of Energy to issue the necessary rules and procedures for the establishment of market prices for the public service of natural gas
transportation. Decrees No. 1023/2024 and No. 370/2025 extended the state of emergency until July 9, 2025 and July 9, 2026, respectively.
ENARGAS has broad authority to regulate the operations of the transportation and distribution companies and has its own budget, which must be
included in the Argentine national budget and submitted to the Argentine Congress for approval. ENARGAS is funded primarily by annual control and inspection fees that are levied on regulated entities in an amount equal to the approved budget
allocated proportionately to each regulated entity based on its respective gross regulated revenues, excluding natural gas purchase and transportation costs in the case of distribution companies.
Since 2004, the Government adopted a series of measures to redistribute the effects of the crisis in the energy sector caused by the natural gas
shortage. Most of the electrical power stations do not have firm gas supply agreements and have increasingly used imported natural gas or alternative fuels that are more expensive than natural gas produced in Argentina. For this reason, ENARGAS
and the Federal Energy Bureau (currently, the Secretary of Hydrocarbon Resources) have issued a series of regulations aimed at averting a crisis in the internal system of natural gas supply.
The Executive Branch issued Decree No. 181/04, directing the Federal Energy Bureau to establish a system of priority pursuant to which power
stations and natural gas distribution companies (for their residential clients) could receive natural gas in priority to other users, even those with firm transportation and firm gas supply contracts. On April 21, 2004, the former Ministry of
Production and Federal Planning, Public Investment and Services issued Resolution No. 208/04 that ratified an agreement between the Federal Energy Bureau and natural gas producers to give effect to this new system.
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Under certain circumstances and pursuant to the terms of our License, when ENARGAS asks us to restrict the provision of natural gas to clients
who hold firm transportation contracts, we are exposed to potential claims from, among others, our customers. Therefore, we have requested that in connection with these new procedures, ENARGAS submit to us written instructions for any such
natural gas firm transportation service interruption request. However, in case ENARGAS does not submit such instruction in the way required by our petition and we do not comply with ENARGAS’s instructions, if any, in order to avoid future
claims from our customers, Resolution No. 208/04 will require us to pay the price difference between natural gas and the alternative fuel used by power stations in order to offset the loss resulting from our failure to comply with the
instructions.
On June 26, 2018, ENARGAS issued Resolution No. 124/2018 which sets modifications to the Dispatch Centers Internal Regulations that establishes
the procedures for natural gas dispatch management, modifying the guidelines for the Dispatch Administration attached to the Transport and Distribution Service Regulations and allow full operability of free access with no discrimination and
competitive environment, and alternatives which guarantee the quality and continuity of gas transport and distribution public service, avoiding the cyclical crisis which may affect the transport and distribution systems, seeking to maintain
clients supply, by preventing service interruptions with an efficient management methodology.
Although the natural gas supply shortage did not create a bottleneck in the transportation capacity that prevented the system from meeting
increasing demand since 2008, the Government continues to impose restrictions from time to time on the consumption of natural gas by certain customers that hold firm transportation contracts with us, in an effort to redirect and target the
supply to the demand regarded as top priority, mainly residential users, CNG stations and industries connected to the distribution network. Such restrictions have affected direct shippers who have firm transportation contracts with us, as well
as industries in different distribution areas of the country.
As of the date of this Annual Report, our compliance has not resulted in legal action initiated by any of our firm transportation clients which
could have a significant adverse economic and financial effect on us. However, any legal action, if brought, could have a significant adverse economic and financial effect on us. See “Item 3. Key Information—D.
Risk Factors.”
Our License. Our
License authorizes us to provide the public service of natural gas transportation through the exclusive utilization of the southern natural gas transportation system. Our License does not grant us an exclusive right to transport natural gas
in a specified geographical area, and licenses may be granted to others for the provision of gas transportation services in the same geographical area. TGN’s natural gas transportation system is operated under a license containing
substantially similar terms to those described below and elsewhere herein.
Our License has been granted by the Executive Branch by Decree No. 2451/92 for an original period of 35 years, beginning on December 28, 1992.
However, the Natural Gas Law provides that we may request ENARGAS to renew its License for an additional period of ten years. According to the Foundations Law, such 10-year period was extended to 20 years. ENARGAS must then evaluate the
performance of tgs and raise a recommendation to the Executive Branch. At the end of the period of validity of the License, 35 or 45 years, as the case may be, the Natural Gas Law requires that a new tender be called for the granting of the
license. As long as we have substantially complied with our obligations under the License, we have the option to match any offer made by a third party to the Executive Branch.
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In September 2023, we submitted a request to ENARGAS for a 10-year extension of the natural gas transportation License, which is set to expire
in December 2027. On June 13, 2024, ENARGAS issued a technical and legal report indicating that we have broadly fulfilled our obligations regarding the License (the “License Report”). Based on the License Report and after a non-binding
public hearing as required by Section 6 of the Natural Gas Law, ENARGAS controller may submit a recommendation to the Executive Branch, which, in turn, may issue a decree granting an extension of the License. The License Report allows ENARGAS
controller, after the non-binding public hearing, held on October 21, 2024, to issue its recommendation report to be submitted to the Executive Branch. On July 24, 2025, the Executive Branch ratified the Memorandum of Agreement for the
extension of our License, which was entered into between us and the Ministry of Economy on July 11, 2025, and pursuant to which the term of our license was extended for an additional period of 20 years from December 28, 2027.
Our License also places certain other rights and obligations on us relating to the services we provide, including:
• operating and safety standards;
• terms of service, including general service conditions, such as specifications regarding the quality of gas transported, major equipment requirements, invoicing and payment procedures, imbalances and penalties, and guidelines for dispatch management;
• contract requirements, including the basis for the provision of service, e.g., “firm” or “interruptible;”
• certain mandatory capital investments that must have been made within the first five years of the license term; and
• applicable rates based on the type of transportation service and the area serviced.
Our License establishes a system of penalties in the event of a breach of our obligations thereunder, including warnings, fines and revocation
of our License. These penalties may be assessed by ENARGAS based, among other considerations, upon the severity of the breach or its effect on the public interest. Through Resolution No. 22/2018, ENARGAS adjusted the amounts of fines applicable
in the event of a breach of obligations, which amount shall be updated on April of every year. On May 7, 2019, through Resolution No. 251/2019, ENARGAS updated the amounts of the fines up to Ps. 21.1 million.
Revocation of our License may only be declared by the Executive Branch upon the recommendation of ENARGAS. Our License specifies several grounds
for revocation, including the following:
• repeated failure to comply with the obligations of our License and failure to remedy a significant breach of an obligation in accordance with specified procedures;
• total or partial interruption of the service for reasons attributable to us, affecting completely or partially transportation capacity during the periods stipulated in our License;
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• sale, assignment or transfer of our essential assets or otherwise encumbering such assets without ENARGAS’s prior authorization, unless such encumbrances serve to finance expansions and improvements to the gas pipeline system;
• bankruptcy, dissolution or liquidation; and
• ceasing and abandoning the provision of the licensed service, attempting to assign or unilaterally transfer our License in full or in part without the prior authorization of ENARGAS, or giving up our License, other than in the cases permitted therein.
Our License also prohibits us from assuming debt of, or granting credit to, CIESA, and creating security interests in favor of, or granting any
other benefit to, creditors of CIESA.
Generally, our License may not be amended without our consent. As part of the renegotiation of our License under the Public Emergency Law,
however, the terms of our License may be changed or our License may be revoked. In addition, ENARGAS may alter the terms of service annexed to our License. If any such alteration were to have an economic effect on us, ENARGAS should modify our
rates to compensate for such effect or we could request a change in the applicable rates.
Regulation of Transportation Rates—Actual Rates. The natural gas transportation rates established for each transportation company must be calculated in U.S. dollars and converted into pesos at the time of billing. However, the Public Emergency Law eliminated
tariff indexing covenants based on U.S. dollar exchange rate fluctuations and established a conversion rate of one peso equal to one U.S. dollar for tariffs.
The rate for natural gas firm transportation services consists of a capacity reservation charge and is expressed as a maximum monthly charge
based on the cubic meters per day of reserved transportation capacity. The rate for natural gas interruptible transportation service, which is expressed as a minimum (from which no discounts are permitted) and a maximum rate per cubic meter of
natural gas transported, is equivalent to the unit rate of the reservation charge for the firm service based on a load factor of 100%. For both firm and interruptible transportation services, customers are obligated to provide a natural gas
in-kind allowance, expressed as a maximum percentage of gas received, equivalent to the natural gas consumed or lost in rendering the transportation service. The rates for all services reflect the rate zone(s) traversed from the point of
receipt to the point of delivery.
No tariff increases have been received between May 1, 2019, and February 28, 2022. On February 1, 2022, ENARGAS provided us with a proposal for
a Transitional Renegotiation Agreement (“2022 Transition Agreement”), which was approved by our Board of Directors on February 2, 2022, and by the different governmental agencies on February 18, 2022. Such agreement was ratified by the
Executive Branch through Decree No. 91/2022, effective as of February 23, 2022, which provides a transitional tariff increase of 60% as of March 1, 2022 (“RTT 2022”).
On February 25, 2022, ENARGAS issued Resolution No. 60/2022, which established that the new tariff charts contemplating the RTT 2022 would come
into effect on March 1, 2022.
On March 16, 2023, our Board of Directors approved the proposed addendum to the renegotiation transitory agreement ( “2023 Transition
Agreement”) sent by ENARGAS. The 2023 Transition Agreement was ratified by the Executive Branch through Decree No. 250/2023 on April 29, 2023. Previously, on April 27, 2023, ENARGAS issued Resolution No. 186/2023, through which the new
applicable tariff schedules were published.
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In addition to transportation tariffs, we are entitled to collect a CAU, which applies to certain assets incorporated into the natural gas
transportation system that were not financed by us. The CAU is intended to compensate for the operation and maintenance of such assets.
Since its inception in 2005, the CAU has been adjusted by ENARGAS on several occasions. Specifically, the CAU was increased by 73.2% effective
May 1, 2015, and by 200.1% effective April 1, 2016. Subsequently, additional increases of 50.0% and 19.7% became effective on April 1, 2018 and October 1, 2018, respectively.
As part of the tariff adjustment processes applicable to natural gas transportation services, the CAU is subject to the same tariff adjustment
mechanisms approved by the regulatory authority. Accordingly, the CAU receives the same tariff increases applicable to transportation tariffs, unless otherwise expressly provided in the relevant regulatory resolutions.
In 2025, we recognized revenues of Ps. 27,538 million related to the CAU. “Item 4. Our Information—B. Business
Overview—Natural Gas Transportation—Pipeline Operations.”
On March 13, 2026, the Secretariat of Energy issued Resolution No. 66/2026, pursuant to which it ordered a reconfiguration of the natural gas
transportation system of Argentina with the purpose of adapting it to Argentina’s new production scheme, which is currently predominantly supplied by the Vaca Muerta formation.
These measures aim to optimize the use of the natural gas transportation system, ensure adequate supply and improve the system’s operational
efficiency. In addition, Resolution No. 66/2026 instructs ENARGAS to adjust tariff schedules, service regulations and capacity allocation mechanisms, within the scope of its regulatory authority, while preserving as an essential condition that
the required revenues determined under the five‑year tariff review remain unchanged.
In this context, through Resolution No. 346/2026, ENARGAS ordered the opening of a public consultation process regarding certain aspects
contemplated in Resolution No. 66/2026. Among the matters subject to consultation were new percentages of retained gas consistent with the new transportation routes of distribution shippers and the recognition of the firm nature of certain ED
services, among other aspects.
The public consultation period expired on April 7, 2026. Subsequently, on April 14, 2026, through Resolution No. 409/2026, ENARGAS declared the
public consultation process concluded and instructed the licensed natural gas transportation companies to enter into new firm transportation agreements, in accordance with the guidelines set forth in Resolution No. 66/2026, providing that such
agreements shall become effective as of May 1, 2026.
Tariff situation.
Background and Renegotiation Process
On January 6, 2002, the Argentine Congress enacted the Public Emergency Law, which introduced dramatic changes to Argentina’s economic model,
empowering the Government to implement, among other things, additional monetary, financial and foreign exchange measures to overcome the economic crisis in the short-term and bringing to an end the regime established pursuant to the Argentine
Convertibility Act, including the fixed parity of the U.S. dollar and the peso. Among others, the Public Emergency Law granted the Executive Branch the power to conduct a renegotiation of public utility contracts and the tariffs set therein.
The Public Emergency Law expired on December 31, 2017.
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Between July 2003 and March 2018, the Company received a series of temporary tariff increases, all within the framework of the integral tariff
renegotiation (Revisión Tarifaria Integral) (“RTI”) process initiated after the enactment of the Public Emergency Law.
On February 16, 2016, the Executive Branch issued Decree No. 367/2016 which repealed the previous regulations governing the renegotiation
process of contracts and licenses for public works and services and transferring to each ministry the responsibility to renegotiate public service contracts. Decree No. 367/2016 also conditioned the finalization of the new tariff scheme
provided in the respective integral renegotiation agreement approved by the Executive Branch to completion of the RTI and provided that transitional adjustment of prices and tariffs are necessary to ensure the continuity of the normal provision
of services.
Under the framework of the agreement signed in February 2016 (the “2016 Transitional Agreement”), on March 31, 2016, ENARGAS issued
Resolution No. 3724, which approved revised tariffs as of April 1, 2016, including the CAU, for the Natural Gas Transportation business segment, providing for a 200.1% increase. Additionally, among other things, Resolution No. 3724 required us
to not distribute dividends without the prior authorization of ENARGAS after reviewing our compliance with the transitional mandatory investment plan included in the 2016 Transitional Agreement (the “2016 Investment Plan”). As of the
date of this Annual Report, the 2016 Investment Plan is fully executed and has been approved by ENARGAS.
As several legal proceedings were initiated against Resolution No. 3724 in order to obtain the annulment of the increase of the PIST and the
tariff increases for the natural gas transportation and distribution licensees approved by ENARGAS, we were not able to bill the 200.1% increase in full. On August 18, 2016, the Supreme Court order issued its final decision mandating the
Government to (i) implement mandatory public hearings prior to the establishment of natural gas transportation and distribution tariffs, (ii) implement mandatory public hearings prior to the establishment of the point-of-injection gas price and
(iii) declare the invalidity of Resolutions 28 and 31 with respect to residential users, for whom tariffs had to be returned to tariff rates effective as of March 31, 2016.
On August 19, 2016, ENARGAS issued Resolution No. 3953/2016, which implemented the decisions arising out of a public hearing before the Supreme
Court. For additional information regarding the public hearing’s agenda, see “—Natural Gas Transportation—The Argentine Natural Gas Industry.”
As a result of this public hearing, since October 7, 2016, we were able to collect the revised tariffs at the levels provided for in Resolution
No. 3724, allowing us to complete our 2016 Investment Plan.
Resolution 74 Tariff Increases
On March 30, 2017, we entered into the Integral Renegotiation Agreement (“2017 Integral Agreement”) and the related agreement signed on
March 30, 2017, between us and the Government (“2017 Transitional Agreement”). On the same day and consistent with the 2017 Transitional Agreement, the Ministry of Energy enacted Resolution 74, which increased the price of the natural
gas consumed by power plants starting on April 1, 2017, and ENARGAS issued Resolution 4362 by which a new transitional tariff schedule applicable to us determined a total tariff increase of 214.2% and 37%, on the tariff of the natural gas
transportation service and the CAU, respectively. Pursuant to Resolution 4362, we were required to execute the five-year plan. In addition, Resolution 4362 contemplates a non-automatic semiannual adjustment mechanism for the natural gas
transportation tariff and the CAU to reflect changes in WPI, which must be approved by ENARGAS evaluating the evolution of the economic circumstances.
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However, Resolution 74 provided for a limitation on the full effectiveness of the tariff increase arising from the RTI process until the
approvals of the 2017 Integral Agreement were completed. This meant that the tariff increase was granted in three stages on April 1, 2017 (granted 64.2% increase in natural gas transportation and no increase in CAU), December 1, 2017 (granted
80.8% increase on natural gas transportation and 29,7% increase in CAU) and April 1, 2018 (granted 50% increase in natural gas transportation and CAU). This staged increase is structured to provide the same economic benefits to us as if the
increases had been fully effective since April 1, 2018.
On March 27, 2018, through Decree 250, the Executive Branch ratified the 2017 Integral Agreement, following the approval of several governmental
authorities, including the Argentine Congress. Decree 250 concluded the RTI process and terminated the 2017 Transitional Agreement, representing the final renegotiation of our License with the Government after 17 years of negotiations. As a
result of the foregoing, (i) we were entitled to the final tariff increase contemplated in Resolution 4362, and (ii) we and our current and former shareholders withdrew any claim against the Government related to our business resulting from the
Public Emergency Law on June 26, 2018.
On June 21, 2019, Secretary of Hydrocarbon Resources issued Resolution 336, through which the payment of 22% of the bills issued from July 1,
2019, to October 31, 2019, to residential customers of natural gas was deferred. Such deferral will be recovered through the bills issued from December 1, 2019, in five consecutive monthly installments. It is expected that the Government will
compensate licensors for such deferral. On August 22, 2019, Secretary of Hydrocarbon Resources issued Resolution No. 488/2019, which established the procedure to calculate the deferral provided by Resolution 336. Furthermore, Resolution No.
488/2019 instructs the implementation of a procedure to calculate and pay the compensation for licensors.
Semiannual Adjustment of Tariffs. Under our License, we may be permitted to adjust tariffs semiannually to reflect changes in PPI and every five years in accordance with efficiency and investment factors to be determined by ENARGAS and, subject to
ENARGAS’s approval, from time to time to reflect cost variations resulting from changes in the tax regulations (other than income tax) applicable to us, and for objective, justifiable and non-recurring circumstances.
The Natural Gas Law requires that in formulating the rules that apply to the setting of future tariffs, ENARGAS must provide the transportation
companies with (i) an opportunity to collect revenues sufficient to recover all future proper operating costs reasonably applicable to service, as well as future taxes and depreciation, and (ii) a reasonable rate of return, determined in
relation to the rate of return of businesses having comparable risk and taking into account the degree of efficiency achieved and the performance of the company in providing the service. No assurances can be given that the rules to be
promulgated by ENARGAS will result in rates that will enable us to achieve specific levels of earnings in the future.
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However, since January 1, 2000, adjustments to tariffs to reflect PPI variations were suspended, first through an agreement with the Executive
Branch and later by a court decision arising from a lawsuit to determine the legality of tariff adjustments through indexes.
Resolution 4362 provided for a semiannual adjustment mechanism based on changes in the WPI. The increase is not automatic, however, as it
requires the prior approval of ENARGAS.
Within the renegotiation process, transitory adjustments of tariffs and/or their segmentation may be foreseen, as the case may be. Likewise, it
must carry out the relevant and appropriate public hearing, public consultation and citizen participation regimes, as well as give intervention to the Procuración del Tesoro de la Nación and to the Sindicatura General de la Nación. Finally, the
resulting agreement must have the corresponding governmental approvals. The renegotiation process culminates with the subscription of a final agreement on the RTI. In this sense, from this resolution, successive increases were approved under
various agreements between the Company and ENARGAS, which, in certain cases, resulted in the initiation of legal actions by tgs.
On December 6, 2022, by means of Decree No. 815/2022, the term for the completion of the RTI established in Decree No. 1020 was extended for a
period of 1 year as from its expiration, i.e., until December 18, 2023. It also extends, as from January 1, 2023, the intervention of ENARGAS, which is instructed, while the renegotiation continues, to carry out the necessary measures to
achieve a transitional tariff adjustment in accordance with Decree No. 1020.
Within this framework, on December 7, 2022, ENARGAS issued Resolution 523 by which it called for a public hearing held on January 4, 2023, in
order to consider a transitional tariff adjustment of the public natural gas transportation service. In said hearing, in which it was informed that the increase pending application, considering the lack of semiannual adjustments by WPI since
April 2019 and the transitory increase granted of 60% as from March 2022, amounted to an estimated 270% as of December 2022, we requested a transitory tariff increase for the year 2023 of 135%, taking into account the current context the
country is going through, aiming at the continuity, accessibility and normal provision of the public service of natural gas transportation, in safe conditions, trying to mitigate the economic and financial effects of the higher costs and
current expenses associated to the service.
On March 15, 2023, ENARGAS submitted a proposal to us for an addendum to the RTI.
On March 16, 2023, our Board of Directors approved the 2023 Transition Agreement sent by ENARGAS. This addendum was subsequently ratified by PEN
through Decree No. 250/2023 of April 29, 2023. Previously, on April 27, 2023, ENARGAS issued Resolution No. 186/2023 which published the new tariff tables in force.
The 2023 Transition Agreement has conditions similar to the 2022 Transition Agreement. The 2023 Transition Agreement includes:
• As of April 29, 2023, a transitional tariff increase of 95% on the natural gas transportation tariff and the Access and Use Charge.
• During its term, we may in no case distribute dividends or cancel in advance directly or indirectly financial and commercial debts contracted with shareholders, acquire other companies or grant credits (unless the credits benefit users or are granted to contractors who do not qualify as users). If we understand it is appropriate to distribute dividends, it must require authorization from the Ministry of Economy. For its part, in the event that we understand it is appropriate to cancel in advance directly or indirectly financial and commercial debts contracted with shareholders, acquire other companies or grant credits, it shall require authorization from ENARGAS.
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On December 14, 2023, through Resolution No. 704/2023, ENARGAS convened a public hearing scheduled for January 8, 2024. On February 9, 2024,
ENARGAS issued Resolution No. 52/2024 which declared that the public hearing was declared valid.
Furthermore, tariffs were to be adjusted monthly, starting in May 2024 and until the completion of the five‑year tariff review process, based on
an index composed of: (i) 47% Wage Index – Registered Private Sector (INDEC), (ii) 27.2% WPI, and (iii) 25.8% Construction Cost Index – Materials Chapter (INDEC). This agreement also removed the previous restriction on dividend payments.
During the months of May to July 2024, ENARGAS notified us that it would postpone the implementation of the monthly tariff adjustment. Likewise,
it notified that it would replace the monthly adjustment methodology mentioned above for the remainder of 2024. According to ENARGAS notification, the monthly tariff increase would be based on the expected inflation to be estimated by the
Ministry of Economy for said periods.
On July 1, ENARGAS once again informed us of the postponement of the monthly tariff increase, this time corresponding to the month of July,
maintaining the tariff schedules in effect since April 3, 2024.
During 2024 and the completion of the five‑year tariff review process in the first quarter of 2025, the Company received tariff increases of
675%, 4%, 1%, 2.7%, 3.5%, 3%, 2.5%, 1.5% and 1.7%, effective from April 3, August 1, September 2, October 1, November 4, December 4, 2024 and January 1, February 1, and March 1, 2025, respectively.
In this regard, and within the framework of the five‑year tariff review process, on January 14, 2025, ENARGAS, through Resolution No. 16/2025,
published the call for the public hearing held on February 6, 2025, with the purpose of considering, among other issues, the five‑year tariff review for gas transportation and distribution, and the periodic adjustment methodology for gas
transportation and distribution tariffs.
At this hearing, we presented, among other aspects, its expenditure and investment plan for the five-year period 2025-2029, the capital base,
and the proposed WACC (9.98% real after taxes). Considering the tariff calculation methodology and the mentioned parameters, a tariff increase of 22.7% was requested compared to the tariffs in effect as of January 2025. Additionally,
alternatives for the periodic tariff adjustment methodology were presented:
• WPI, or
• A polynomial formula composed of information published by INDEC:
‒ 30% WPI,
‒ 40% total registered wage index, and
‒ 30% construction cost index for materials.
On April 30, 2025, ENARGAS published Resolution No. 256/2025, which sets forth the conditions of the five‑year tariff review for the 2025–2030
period. The main aspects include:
• Regulatory capital base: determined as of December 31, 2024.
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• Discount rate (WACC): 7.18% real after taxes.
• Initial tariff increase: weighted average of 3.67%, subsequently adjusted to 4.74% to be applied in 31 equal and consecutive monthly installments starting in May 2025.
• Five-Year Investment Plan: totaling $279,107,575 (at June 2024 currency), subject to ENARGAS oversight.
• Regulated operating expenses: defined for the 2025–2030 period.
The resolution also provides that the mechanism for periodic tariff adjustments will be based on a formula that equally combines the CPI and the
WPI, both published by INDEC. However, the formal approval of this methodology was postponed.
Under Decree No. 371/2025, the Secretariat of Energy was designated as the enforcement authority to introduce contractual or tariff
modifications. In line with this, on June 4, 2025, Resolution No. 241/2025 was issued, providing for the periodic update of transportation tariffs on a monthly basis (“Periodic Update”), replacing the previous semiannual scheme.
On June 5, 2025, we agreed to said resolution, and ENARGAS, through Resolution No. 350/2025, approved the methodology for calculating the
periodic adjustment and the tariff schedules effective as from June 6, 2025, which incorporate a Periodic Update of 2.81% and the application of the five‑year tariff review increase.
On July 1, 2025, Resolution No. 421/2025 was published, granting a Periodic Update of 0.62% and the corresponding five‑year tariff review
increase. On August 1, September 1, October 1, November 1, December 1, 2025 and January 1 and February 1, 2026, through Resolutions No. 539/2025, 622/2025, 732/2025, 812/2025, 907/2025, 1001/2025 and 32/2026 and a Periodic Update of 1.63%,
2.38%, 2.49%, 2.89%, 1.71%, 2.03% and 2.63%, respectively, was granted together with the corresponding five-year tariff review increase, effective as from those dates.
Certain Restrictions with Respect to Essential Assets. A substantial portion of the assets transferred by GdE were defined in our License as essential to the performance of the licensed natural gas transportation service. Pursuant to our License, we are
required to segregate and maintain the essential assets, together with any future improvements thereon, in accordance with certain standards defined in our License.
We may not for any reason dispose of, encumber, lease, sublease or lend essential assets for purposes other than the provision of the licensed
service without ENARGAS’s prior authorization. Any extensions or improvements that we make to the natural gas pipeline system may only be encumbered to secure loans that have a term of more than one year to finance such extensions or
improvements.
Upon expiration of our License, we will be required to transfer to the Government or its designee the essential assets specified in our License
as of the expiration date, free of any debt, encumbrance or attachment. If we decide not to participate in a new bidding for a new License term, we will receive compensation equal to the lower of the following two amounts:
• the net book value of the essential assets determined on the basis of the price paid by CIESA for shares of our common stock plus the original cost of subsequent investments carried in U.S. dollars in each case adjusted by the PPI, net of accumulated depreciation in accordance with the calculation rules to be determined by ENARGAS (since the enactment of the Public Emergency Law, this provision may no longer be valid); or
• the net proceeds of a new competitive bidding (“New Bidding”).
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Once the period of the extension of the License expires, we will be entitled to participate in the New Bidding, and, thus, we shall be entitled to:
• submit a bid computed at an equal and not lower price than the appraisal value determined by an investment bank selected by ENARGAS, which represents the value of the business providing the licensed service at the valuation date, as a going concern and without regard to the debts;
• match the best bid submitted by third parties in the New Bidding, if it would be higher than our bid mentioned above, paying the difference between both values to obtain a new license; and
• if we have participated in the New Bidding but are unwilling to match the best bid made by a third party, receive the appraisal value as compensation for the transfer of the essential assets to the new licensee, with any excess paid by the third-party remaining for the grantor.
Under Argentine law, an Argentine court will not permit the enforcement of a judgment on any of our property located in Argentina which is
determined by the courts to provide essential public services. This may adversely affect the ability of a creditor to realize a judgment against our assets.
Under a transfer agreement we entered into in connection with the privatization of GdE in the 1990s (the “Transfer Agreement”),
liabilities for damages caused by or arising from the GdE assets are allocated to either GdE or us depending on whether any such damage arose or arises from the operation of the assets prior to or following the commencement of our operations.
Also, pursuant to the Transfer Agreement, we are responsible for any defects in title to such assets, although any such defects are not expected to be material. The Transfer Agreement further provided that GdE was responsible for five years
until December 1997 for the registration of easements related to the system, which were not properly recorded, and for the payment to property owners of any royalties or fees in respect thereof. Since 1998, we have been responsible for properly
recording any remaining easement agreements and for making payments of royalties or fees related to such easements.
Environment
Environmental matters of the natural gas transportation business are governed by Argentine natural gas rule 153 issued by ENARGAS, which sets
the guidelines for the implementation of an environmental management system and for the obligation to evaluate the environmental impact of projects.
Our business activities primarily have an impact on the atmosphere (as a result of methane release and combustion gases), the soil and
watercourses due to the pipelines (including maintenance, third parties’ actions or failures). Our activities also generate hazardous waste and environmental noise. Further, we may be required to handle universal archeological or
paleontological findings during works. All these aspects are monitored and measured under our comprehensive environmental program. We also conduct an annual emergency drill program to test our response capacity under safety and environmental
emergencies, the 2021 drill was completed with satisfactory results. Our policy also extends to our contractors, who are required to comply with the same standards and implement environmental protection measures for the execution of each work.
See “Item 4. Our Information—D. Property, Plant and Equipment—Environmental, Social and Governance.”
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Competition
Our Natural Gas Transportation business provides an essential public service in Argentina in accordance with Article No. 1 of the Natural Gas
Law. Although there are no regulatory limitations on entry into the business of providing natural gas transportation services in Argentina, the construction of a competing pipeline system would require substantial capital investment and the
approval of ENARGAS. Moreover, as a practical matter, a direct competitor would have to enter into agreements with natural gas distribution companies or end-users to transport a sufficient quantity of natural gas to justify the capital
investment. The building and operation of a natural gas pipeline requires important technical know-how and high investment levels.
Currently, demand for natural gas transportation exceeds available capacity in certain segments of the system. However, as supply and
transportation capacity become more balanced, we could face increased competitive scenarios with TGN, particularly based on tariff differentials.
In addition, tariffs applicable to natural gas transportation services are regulated and approved by ENARGAS in accordance with the Natural Gas
Law and the applicable regulatory framework. As a result, competition in the natural gas transportation segment is not primarily driven by price flexibility, but rather by available capacity, service conditions, system reliability and access to
supply and demand centers. Regulatory constraints on tariff adjustments may limit our ability to respond to competitive pressures solely through pricing mechanisms.
The ability of new entrants to successfully penetrate our market would depend on a favorable regulatory environment, an increasing and
unsatisfied demand for natural gas by end-users, sufficient investment in downstream facilities to accommodate increased delivery capacity from the natural gas transportation systems and the finding of significant natural gas reserves. Given
the potential of Vaca Muerta’s non-conventional gas formation, other competitors, new market participants or even us in association with third parties may become interested in participating in the construction of new similar projects that could
have an impact on our competitive position and on our financial situation and future results of operations.
To a limited extent, we compete with TGN on a day-to-day basis for natural gas interruptible transportation services and, from time to time for
new natural gas firm transportation services made available as a result of expansion projects to the natural gas distribution companies to whom both we and TGN are either directly or indirectly connected (Camuzzi Gas Pampeana S.A., Metrogas
S.A. and Naturgy Argentina S.A.). We compete directly with TGN for the transportation of natural gas from the Neuquén Basin to the greater Buenos Aires area.
Additionally, we face indirect competition from gas marketers, who purchase remaining gas transportation capacity to resell it. As gas marketers
resell the remaining capacity to third parties at a lower price, greater efficiency in system utilization and a higher load factor could be achieved. We could have idle transportation capacity that industrial customers do not need to contract
on a firm basis because they can purchase this capacity at the lower interruptible transportation tariff.
In the long term, demand for natural gas transportation services may also be affected by the relative cost of natural gas compared to
alternative energy sources. Based on energy content, the delivered cost of natural gas to end‑users in Argentina remains significantly lower than that of most alternative fuels, with the exception of hydroelectric power.
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The Argentine Government has implemented a series of policies and infrastructure initiatives aimed at promoting the exploration and development
of new natural gas reserves and strengthening the transportation system. Through Resolution No. 1036/2021, the Secretariat of Energy approved the Guidelines for an Energy Transition Plan to 2030, which establish strategic objectives for the
Argentine energy matrix, including energy efficiency, lower greenhouse gas emissions, gasification, resilience of the energy system, regional integration and the development of new energy technologies.
Within this framework, on February 11, 2022, Resolution 67 was published, which created the Transport.Ar Program whose main purpose is to
promote the development and growth of natural gas production and supply.
The Transport.Ar Program includes, among other projects, the construction of the GPM, the Mercedes–Cardales pipeline, expansions of the NEUBA II
pipeline through loops and compression, the reversal of the Northern Gas Pipeline, expansions of the Central‑West Gas Pipeline, and capacity expansions in the final sections of the gas transportation system serving the Buenos Aires Metropolitan
Area.
Additional projects contemplated for subsequent stages include expansions of the Northeast Argentina Gas Pipeline (Gasoducto del Noreste Argentino) (“GNEA”) through compression, new interconnections within the northeastern region, additional looping and compression works in the Entrerriano Gas Pipeline, expansions of the General San
Martín Gas Pipeline and the execution of Stage III of the GNEA in the Provinces of Corrientes and Misiones.
By Decree No. 76/2022, the transportation concession for the GPM was granted to IEASA for a term of 35 years, and the FONDESGAS trust
was created, with IEASA as trustee and beneficiary and Banco de Inversión y Comercio Exterior S.A. as trustee. The first stage of the GPM connects Tratayén, in the Province of Neuquén, with Salliqueló, in the Province of Buenos Aires, where it
is interconnected with our gas transportation system. A second stage contemplates the extension of the pipeline to San Jerónimo, in the Province of Santa Fe.
Notwithstanding, on June 19, 2024, we submitted the private initiative proposal which seeks to replace natural gas and liquid imports each
winter by using existing infrastructure, complementing the construction of Stage 2 of the GPM.
The project was declared of national public interest and authorized for bidding by ENARSA. On May 22, 2025, ENARSA launched National and
International Public Tender GPM No. 01/2025, which was awarded to us and approved by the Secretariat of Energy on October 17, 2025. In addition, we committed to execute complementary expansion works in the final sections of our licensed
transportation system, which are necessary to achieve the project’s objectives. The works are scheduled to be completed by April 30, 2027.
The project will be developed under the RIGI and involves an estimated investment of approximately US$560 million.
In addition, the Government has implemented a number of projects to encourage the exploration and development of new natural gas reserves, or
secure alternative supplies of natural gas, in recent years. See “—Natural Gas Transportation—The Argentine Natural Gas Industry.” For example, the Northeast pipeline is a project, led by the Government,
which will connect the Bolivian natural gas basins with the northeastern region of Argentina and the greater Buenos Aires region. In recent years, the Government has carried out, albeit with some delays, the development of the expansion works.
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LIQUIDS PRODUCTION AND COMMERCIALIZATION
Our Liquids Production and Commercialization activities are conducted at our Cerri Complex, which is located near the city of Bahía Blanca in
the Province of Buenos Aires. At the Cerri Complex, ethane, LPG and natural gasoline are extracted from natural gas, which arrives through our three main pipelines from the Neuquina, San Jorge Gulf and Austral natural gas basins.
We own the Liquids obtained at our Cerri Complex. We purchase natural gas in order to replace thermal units consumed in the Liquids production
process. These natural gas purchases are negotiated with certain natural gas distributors, traders and producers. The results of our Liquids Production and Commercialization segment are subject to risks associated with commodity price
fluctuations.
During 2025, 2024 and 2023, all of our Liquid sales were conducted on our own account. Sales of Liquids in the domestic market are regulated
through the Households with Bottles Program (as defined below) of the Ministry of Energy, which aims to guarantee the supply at reasonable prices. For more information, see “—Regulation—Domestic market”
below.
Liquids production in 2025 totaled 1,095,813 tons, representing an increase of 44,159 tons or 4.2% compared to 2024. During 2025, there were no
production restrictions resulting from natural gas interruptions requested by governmental authorities.
With respect the volume of processing gas at the Cerri Complex, there was a slight decrease compared to 2024. In addition, gas volumes arriving
through the San Martín pipeline continued to decline despite the start up of production from the Fénix project, thereby increasing the relative importance of gas supplied from the Neuquén Basin.
In 2025, we were the second-largest ethane producer in Argentina, behind MEGA, and our market share increased to more than 40% of the total
ethane production in the country. The graphs below illustrate our share of total propane and butane production in Argentina during 2025:
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During 2025, propane and butane deliveries to the export market were conducted on a spot basis, allowing us to capture opportunities across
different market niches and resulting in a significant increase in fixed premiums per transaction. We also continued strengthening our position in the Brazilian market by maintaining direct maritime exports (without intermediaries) to Brazilian
LPG distributors.
With respect to natural gasoline exports, during 2025 these volumes were commercialized under a contract entered into with Trafigura Pte Ltd. at
international prices less a discount. This contract, which covered the period from March 2024 through February 2026, improved the conditions of the agreement that was in effect until February 2024. Subsequently, we entered into a new agreement
with ATMI (subsidiary of Total Energies) for the period from March 2026 to February 2028, further improving the contractual conditions applicable in 2025.
For additional information regarding Liquids price evolution during the years 2025 and 2024, see “Item 5.
Operating and Financial Review and Prospects—A. Operating Results.”
Truck exports to neighbouring countries also increased. We operate under this modality with Paraguay and Brazil. Although export volumes by
truck are significantly lower than those shipped by sea, these operations allow us to achieve higher profit margin.
In 2025, we continued commercializing LPG by land, dispatching approximately 11,402 trucks (303,106 tons) loaded with our own product, compared
to 14,389 trucks (331,751 tons) dispatched in 2024. These truck dispatches, which are primarily intended to meet the domestic demand, also enable exports to neighboring countries. While volumes are lower than maritime exports, they generate
operating margins and contribute to the expansion of our clients’ portfolio.
All of our ethane production is sold to PBB under a long-term agreement executed on September 6, 2018, which expires on December 27,2027. This
agreement includes, among other conditions, TOP and DOP commitments for minimum annual quantities, which are lower than the TOP volumes established under 2015 ethane agreement with PBB. If either party fails to comply with the applicable TOP or
DOP commitments, such party is required to compensate the other for the breach of the minimum annual quantity obligations. Pursuant to the current contract, in the event of a default by PBB with respect to its TOP commitments, PBB is required
to compensate us. The Liquids Production and Commercialization segment also includes storage and truck dispatch of liquids extracted at the Cerri Complex to facilities located in Puerto Galván. LPG and natural gasoline are transported through
two eight-inch pipelines to the loading terminal at Puerto Galván. Ethane is transported via an eight-inch pipeline to the PBB plant, which is the sole outlet for ethane produced at the Cerri Complex. Any ethane that cannot be sold to PBB is
reinjected into the pipeline.
Over the past several years, the Liquids Production and Commercialization segment has provided us a stable source of cash generation, supported
by a diversified product mix, flexible commercialization strategies and efficient use of existing infrastructure. This segment has demonstrated a high degree of operational efficiency and resilience, enabling us to sustain production levels,
fulfill contractual commitments and capture export opportunities. This performance was achieved despite the significant climate-related event that affected the Cerri Complex, underscoring the robustness of our facilities, logistics and
commercial capabilities, as well as the effectiveness of our operational and contingency management practices.
In 2025, our export revenues from the Liquids Production and Commercialization segment were Ps. 292,674 million, representing 17.0% of our total
revenues and 45.3% of segment revenues. The total liquids sales volume reached 1,076,729 tons, of which 438,327 tons corresponded to export sales, representing 40.7% of total liquids sales volume.
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The annual sales of our Cerri Complex for 2025, 2024 and 2023 in tons were as follows:
2025 2024 2023
Ethane 334,596 309,894 394,370
Propane 383,622 393,669 369,683
Butane 260,051 266,123 235,861
Natural Gasoline 98,460 107,664 129,272
Total 1,076,729 1,077,350 1,129,186
We anticipate that new oil and natural gas developments in Argentina will provide new opportunities in the Liquids Production and
Commercialization business and lead to related increases in revenues from our Natural Gas Transportation and Liquids Production and Commercialization businesses.
Regulation
Liquids Production and Commercialization activities are not subject to regulation by ENARGAS. However, in recent years, the Government has
enacted regulations that have significantly affected our Liquids production activities.
Domestic market
Producers of LPG are required to prioritize the supply of the domestic market before exporting significant volumes. As a result, we may
be required to forego sales to foreign markets where prices for certain products are higher than those applicable in the Argentine domestic market.
On April 1, 2005, Law No. 26,020 was enacted, establishing the regulatory framework for the LPG industry and its commercialization. Under this
regime, the Secretariat of Energy is authorized to adopt measures to ensure domestic supply, including the determination of minimum volumes to be allocated to the local market and the establishment of reference prices for LPG sold domestically.
Since 2015, the “Households with Bottles Program” (Plan Hogar) has been in force. This program establishes maximum reference prices and
mandatory supply quotas for LPG producers in order to guarantee access to LPG for low-income residential users. The compensation mechanism originally provided to producers participating in the program was eliminated in February 2019.
During 2024, within the framework of the Households with Bottles Program, maximum reference prices continued to apply, requiring producers to
supply LPG at regulated prices and within defined quotas. During 2025, regulated prices increased cumulatively by 41.42% between December 31, 2024 and December 31, 2025, reaching Ps. 593,952 per ton at year-end.
On January 24, 2025, the Secretariat of Energy issued Resolution No. 15/2025, effective as of that date, which (i) eliminated the maximum sale
prices applicable under the Households with Bottles Program, (ii) mantained the LPG export parity price published by the Secretariat of Energy pursuant to Law No. 26,020 as the applicable price cap, and (iii) maintained the obligation for LPG
producers to supply the domestic market while eliminating previously required product contribution mechanisms. As a result, prices under the Households with Bottles Program were liberalized within the export parity price limit, while domestic
supply obligations remained in effect.
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In addition, we participate in the Propane Gas Supply Agreement for Undiluted Propane Gas Distribution Networks (the “Propane for Networks
Agreement”) entered into with the Argentine Government and propane producers. Pursuant to this agreement, we are required to supply propane to distributors and sub-distributors at prices below market levels. Under this framework, we receive
economic compensation calculated as the difference between the agreed domestic sales price and the export parity price determined by the Secretariat of Energy. The timing and effectiveness of such compensation mechanisms depend on
administrative and fiscal processes implemented by the Argentine authorities.
The Propane for Networks Agreement has been extended on several occasions. The agreement in force until December 31, 2023 was executed on August
18, 2023 and ratified by Decree No. 496/2023 dated October 2, 2023. During most of 2024, propane deliveries continued to be made under its terms following instructions from the Secretariat of Energy. On November 6, 2024, we entered into a new
Propane for Networks Agreement valid until December 31, 2024, which was subsequently ratified by Decree No. 183/2025 dated March 12, 2025.
On January 31, 2025, through Note No. NO‑2025‑11082035‑APN‑DGL#MEC, the Secretariat of Energy instructed us to continue supplying undiluted
propane to the domestic market until a new Propane for Networks Agreement entered into effect. The framework governing such supplies was further extended by Decree No. 970/2025. On March 27, 2024, the Secretariat of Energy updated the price
applicable to undiluted propane deliveries, setting it at 25% of the export parity price published by the Secretariat of Energy, effective upon the approval of new distribution tariffs by ENARGAS, which were published in the Official Gazette on
April 3, 2024.
The Government compensates us for our participation in the Propane for Networks Agreement, through fiscal credit certificates which may be
applied to the payments of export duties. As of December 31, 2025, the Argentine State owed us Ps. 12,720 million in connection with this program. The recovery of these amounts and their application against export duties may be subject to
timing differences and administrative procedures.
For more information see “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Liquids
Production and Commercialization Segment.”
International Market
In the international market, we commercialize propane, butane and natural gasoline to international traders and other clients.
On September 4, 2018, pursuant to Decree No. 793/2018 (as subsequently amended by National Executive Branch Decree No. 865/2018, the
effectiveness of which was ratified by Law No. 27,467), the National Executive Branch established a 12% export duty on all goods included in the MERCOSUR Common Customs Nomenclature, subject to a cap of Ps. 4 per U.S. dollar for the products
exported by us. This cap was eliminated on December 16, 2019, pursuant to Decree No. 37/2019.
Through Law No. 27,541, the Executive Branch was empowered to set export duties until December 31, 2021, provided that such duties did not
exceed 33% of the taxable value of the exported goods. With respect to hydrocarbons, such law established that export duties could not exceed 8% of the taxable value.
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On May 19, 2020, the Government issued Decree No. 488/2020 pursuant to which, among others, the price per barrel of crude oil in the local
market was fixed at US$45 until December 31, 2020. This measure was subject to review if the ICE Brent first line price exceeds US$45 / bbl for 10 consecutive days. Decree No. 488/2020 also introduced modifications to the tax regime applicable
to domestic fuel consumption and export duties.
During the fiscal year ended December 31, 2025, the average export duty rate applicable to our products was 7.41%.
Environment
In addition to this sector-specific regulation, we are subject to environmental legislation enacted by each of the seven provinces through our
high-pressure trunk gas pipeline system runs.
Our production and liquid storage facilities are subject to Law No. 11,459 on industrial establishment of Buenos Aires. We are also required to
comply with all applicable provincial environmental legislation, including regulations governing gas emissions, waste disposal, the use of public waters and the discharge of effluents, among others. Both the Cerri Complex and the Puerto Galván
facilities hold valid environmental certificates.
See “Item 4. Our Information—D. Property, Plant and Equipment—Environmental, Social and Governance.”
Competition
The construction and operation of natural gas processing plants located in the Province of Neuquén have represented a source of competition for
our Liquids business, as our customers may satisfy their demand through alternative suppliers. In the past, this competition was mitigated through agreements entered into with natural gas producers that limited their ability to make investments
in natural gas processing facilities.
For example, at the end of 2000, MEGA completed construction and commenced operations of a gas processing plant with a capacity of approximately
1.3 Bcf/d, located in the Province of Neuquén. Although the construction of this gas processing plant initially resulted in lower volumes of gas arriving at the Cerri Complex, we implemented measures to substantially mitigate the related
adverse effects. However, there is a risk that additional gas processing at the MEGA plant could result in lower volumes or lower quality gas (i.e., gas with lower liquids content) arriving at the Cerri Complex in the future. In addition, other
upstream projects that may be developed could adversely affect our revenues from Liquids production and commercialization services.
In the past, our sole purchaser of ethane, PBB, elected for commercial reasons to prioritize ethane supplied by MEGA. If PBB continues to
increase its purchases of ethane from competitors, our revenues from Liquids production and commercialization services could be adversely affected if we are unable to sell excess ethane and are required to reinject it into the gas stream.
To ensure access to unprocessed natural gas at Cerri Complex, we previously obtained commitments from certain natural gas producers not to
construct natural gas processing plants upstream of the Cerri Complex during the term of long-term agreements. As these agreements expired, we renew or entered into new contracts to replace them. More recent agreements have shorter terms.
However, all current agreements include commitments by such producers not to reduce the quality of the natural gas supplied to us. Notwithstanding these commitments, any changes in the methodology used by producers to inject natural gas into
the pipeline system could result in the receipt of lower quality gas, thereby reducing the volume of liquids available for extraction and processing in the Cerri Complex.
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MIDSTREAM
Other business activities are not subject to regulation by ENARGAS.
Midstream Services
Under our Midstream business segment, we provide midstream integral solutions related to natural gas production, from the wellhead up to the
transportation systems. The services comprise gas gathering, compression and treatment, as well as construction, operation and maintenance of plants and pipelines, which are generally rendered to natural gas and oil producers at the wellhead.
Our portfolio of midstream customers also includes distribution companies, big industrial users, power plants and refineries. Our midstream activities also include the separation and removal of impurities such as water, carbon dioxide and
sulfur from the natural gas stream, and steam generation for electricity production. Small diameter pipes from the wellheads form a network, or gathering system, carrying the gas stream to larger pipelines where field compression is sometimes
needed to inject the gas into our large diameter gas pipelines. The services are tailored to fit the particular needs of each customer in technical, economic and financial matters.
This business segment includes the transportation and all related services provided in Vaca Muerta after the important gas pipe project carried
out during 2019 which allow us to comply with the agreements signed with the main natural gas producers in the area.
In addition, we provide operation and maintenance of pipelines services to our affiliate Gas Link S.A. (“Link”).
Furthermore, we aim to have a leading role in the development of Argentina’s energy sector. For this reason, we developed a gas gathering
network in the Southern Section and Northern Section in the Vaca Muerta fields. To make these investments viable, we executed agreements with various natural gas producers and contracted natural gas treatment services for a period of 10 years.
The construction of a catchment and gathering pipeline and a natural gas conditioning plant in the Vaca Muerta field allows us to gather
non-conventional gas from the Neuquén Basin and subsequently inject it into the main gas pipeline systems, ensuring its supply to all of Argentina’s regions. This project means a significant improvement in our role in the natural gas
development of Argentina and is part of our growth strategy.
The total original investment in both the Northern Section and the Southern Section of the pipeline gathering system and the natural gas
conditioning plant located at the ending point of both sections was US$260 million. The 91 miles gathering pipeline formed by the Northern and Southern Sections gather and transport the natural gas production of several hydrocarbon areas within
the Vaca Muerta play. The natural gas pipelines have a total transportation capacity of 60 MMm3/d and the conditioning plant (called Tratayén Plant), originally
had a capacity of 6 MMm3/d of natural gas.
As a consequence of the increase in natural gas production levels registered in the Neuquén basin, we have recorded increasing levels of
utilization of our midstream facilities; this is mainly evident in the Vaca Muerta system, which started 2021 gathering and treating flows of around 3.5 MMm3/d at the Tratayén Plant and ended year 2024 with flows of around 28 MMm3/d. To cope
with this flow growth several expansion projects were carried out at the Tratayén Plant:
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• In year 2020 the first expansion project was approved, increasing the plant total gas conditioning capacity up to 7.7 MM m3/d. These works, completed in September 2021, involved the installation of a new slug catcher and a new stabilizing column.
• In year 2021 the installation of two Joule Thomson gas conditioning plants was approved. These works, finalized in 2023, increased total gas conditioning capacity to 14.5 MM m3/d. This project involved an estimated investment of US$32 million.
• The third expansion stage, finished in October 2024 and February 2025, consisted of the installation of two gas processing plants (6.6 MMm3/d capacity each, cryogenic technology in both cases). These two plants are operated in gas conditioning mode until conditions make possible to develop a gas processing project in Tratayén Plant. With the addition of these plants the total gas condition capacity will grow up to 28 MM m3/d. Total estimated investment for this expansion is US$360 million.
This project will continue to improve the profitability of the investment made by us and generate business opportunities by providing security
in the evacuation of natural gas volumes, such as the ones committed by producers under the Plan Gas.Ar.
Additionally, in August 2023 the construction work to extend the gas pipeline gathering network of the Vaca Muerta system was completed. With an
investment of approximately US$ 60 million, this 32 kms long pipeline extends from the Los Toldos I Sur area to El Trapial (Vaca Muerta Northern Section); the commissioning of this pipeline enables the current configuration of our intake
system, with a total length of 183 km.
This effort was accompanied by the negotiation and closing of new service contracts (transportation and conditioning) with Tecpetrol,
Pluspetrol, Vista, YPF, Pampa Energía and Chevron.
Plaza Huincul operations matched our forecasts in terms of incoming gas flows and financial performance. We don´t foresee substantial growth
opportunities for this plant in the near future.
We have been providing all these services for a long time and, in view of the growth in these services demand, they have been grouped into a
business line with its own title to enhance its development in the market. Consequently, in 2023, we launched our INTEGRA program.
INTEGRA groups all the services that we offer to the market based on the human resources and tools with which it supports the management of its
own assets: from the execution of minor works and pipeline repair works to laboratory works such as meter calibration and analysis of hydrocarbon samples, including the operation and maintenance of pipelines and plants, project management,
pipeline integrity studies, etc. We also have in-house facilities for turbomachinery overhaul services.
They also reinforce our commitment to Argentina’s energy development and our strategy of making the investments made in the installation of the
Vaca Muerta gas pipeline system profitable. In this sense, we continue in conversations with the different producers in the basin in order to capture business opportunities that will allow us to increase our portfolio of services and client
portfolio.
We have entered into an UT with SACDE for the purpose of participating jointly in the National Public Bid No. 452-0004-LPU17: Assembly of
Pipes for the Construction of the Project “Expansion of the Natural Gas Transportation and Distribution System.” As a result of this bid, the Ministry of Mines and Energy awarded to the aforementioned UT
the contract for the construction of the Regional II-Recreo/Rafaela/Sunchales Regional Gas Pipeline. As of the date of issuance of this Annual Report, construction works are in progress.
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On June 19, 2024, we submitted the private initiative proposal which seeks to replace natural gas and liquid imports each winter by using
existing infrastructure, complementing the construction of Stage 2 of the GPM. This project aims to increase the natural gas transportation capacity by 14 MMm³/d. The awarded party will be granted the exclusive right to use such capacity for a
period of 15 years, including the operation and maintenance of the pipeline and complementary infrastructure. The project was declared of national public interest and authorized for bidding by ENARSA. On May 22, 2025, ENARSA launched National
and International Public Tender GPM No. 01/2025, which was awarded to us and approved by the Secretariat of Energy on October 17, 2025. This initiative involves an estimated investment of US$ 560 million by us and has been declared of public
interest, as it supports the growth of natural gas transportation capacity from Vaca Muerta.
Telcosur (Telecommunications System)
We own 99.98% of Telcosur, a telecommunications company created in September 1998 to provide value-added and data transportation services using
our modern digital land radio telecommunications system with Synchronous Digital Hierarchy technology (which was installed for purposes relating to our gas transportation system).
With respect to the telecommunications services provided by Telcosur, during the year 2024, agreements were reached that allowed increasing the
capacity sold and consolidating the Company’s operations.
In line with the strategy of consolidating the business in the medium and long-term, Telcosur reached agreements with new customers and was able
to expand or renew existing agreements. Telcosur’s strategy is focused on being a service provider in Vaca Muerta, taking advantage of its infrastructure and know-how in the industry. It is in this sense that among its main clients are the main
oil and gas producers in the area as well as other telecommunications companies that provide services to them.
New technologies
Progress was made with “IoT” radio bases to expand Telcosur’s portfolio of services provided to its customers. Augmented reality and drone
services were added to Telcosur’s service portfolio, making progress with the development of digital twins for antenna support masts and an innovative system for monitoring the verticalization of antenna support structures. A predictive system
for monitoring data networks was implemented, which allowed Telcosur to advance in the early detection of network events and to act proactively to benefit customer service.
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C. Organizational Structure
The following is a summary diagram of our subsidiary (Telcosur) and affiliates as of December 31, 2025, including information about ownership
and location:
D. Property, Plant and Equipment
Gas Transportation
The principal components of the pipeline system we operate are as follows:
Pipelines. We render natural gas transportation service through a pipeline system that is 5,746 miles long, of which 4,768 miles operated
under the License on an exclusive basis. We manage the transportation of natural gas over the remainder of the system under management agreements with the Gas Trust, which owns the remaining portions of the pipeline. The system consists
primarily of large diameter, high-pressure pipelines intended for the transportation of large volumes of gas at a pressure of approximately 853-996 pound/square inch. Line valves are installed on the pipeline at regular intervals, permitting
sections of the pipeline to be isolated for maintenance and repair work. Gas flow regulating and measurement facilities are also located at various points on the system to regulate gas pressures and volumes. In addition, a cathodic protection
system has been installed to protect the pipeline from corrosion and significantly reduce metal loss. All of the pipelines are located underground or underwater.
Maintenance bases. Maintenance bases are located adjacent to the natural gas pipeline system in order to maintain the pipeline and
related surface facilities and to handle any emergency situations which may arise. Personnel at these bases periodically examine the pipelines to verify their condition and inspect and lubricate pipeline valves. Personnel at the bases also
carry out a cathodic protection system to ensure that adequate anti-corrosion systems are in place and functioning properly. Such performance also maintains and verifies the accuracy of our measurement instruments to ensure that these are
functioning within appropriate industry standards and in accordance with the specifications contained in our service regulations.
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Compressor plants. Compressor plants along the pipelines recompress the natural gas volumes transported in order to restore pressure to
optimal operational levels, thereby ensuring maximum use of capacity as well as efficient and safe delivery. Compressor plants are spaced along the pipelines at various points (between 62 and 124 miles) depending upon certain technical
characteristics of the pipelines and the required pressure for transport. Compressor plants include mainly turbine-driven compressors and, to a lesser extent, motor-driven compressors which use natural gas as fuel, together with electric power
generators to supply the complementary electrical equipment (control and measurement devices, pumping, lighting, communications equipment, etc.).
We transport natural gas through four major pipeline segments: General San Martín, Neuba I Gas Pipeline, Neuba II Gas Pipeline and Loop Sur Gas
Pipeline, as well as several smaller natural gas pipelines. Information with respect to certain aspects of our main natural gas pipelines as of December 31, 2025, is set out in the table below:
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Major Pipeline Length (miles) Diameter (inches) Maximum Pressure (pound/inch) Compressor Units Operative Compressor Plants HP Output
General San Martín 2,853 24/30 853/995 59 17 512,800
Neuba I/Loop Sur.. 732 24/30 853 14 5 57,800
Neuba II 1,235 30/36 975/995 21 7 194,000
Other (1) 926 Various Various 6 3 7,500
Total 5,746 100 32 772,100
(1) Includes 247 miles of transfer pipelines throughout the pipeline system, as well as the Cordillerano pipeline, with a length of 274 miles, and the Chelforó-Conesa pipeline and other minor pipelines.
General San Martín. This pipeline was
built in three stages, completed in 1965, 1973 and 1978, and transports natural gas from the extreme southern portion of Argentina to the greater Buenos Aires area in east-central Argentina. It originates in San Sebastián (Tierra del Fuego),
passes through the Strait of Magellan and the Provinces of Santa Cruz, Chubut, Río Negro and Buenos Aires (including the Cerri Complex located near the city of Bahía Blanca in central Argentina), and terminates at the high pressure
transmission ring around the City of Buenos Aires. The pipeline receives natural gas from the Austral basin at the extreme south in the Province of Tierra del Fuego, from the same basin further north at El Cóndor and Cerro Redondo, in the
Province of Santa Cruz and from the San Jorge basin in the northern Santa Cruz and southern Chubut Provinces. The natural gas pipeline primarily serves the districts and cities of Buenos Aires, La Plata, Mar del Plata, Bahía Blanca, Puerto
Madryn and Comodoro Rivadavia. This pipeline was expanded in 2005 by the Gas Trust in order to satisfy the growing natural gas demand in the Argentine economy. This expansion resulted in the construction of 458 miles of pipeline and the
installation of new compressor units. See “Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Pipeline Operations.”
Neuba I Gas Pipeline
(Sierra Barrosa-Bahía Blanca). Neuba I Gas Pipeline was built in 1970 and was expanded by us in 1996. It is one of our two main pipelines serving our principal source of gas supply, the Neuquén Basin. The pipeline originates in west-central
Argentina at Sierra Barrosa (Province of Neuquén), passes through the Provinces of Río Negro, La Pampa and Buenos Aires, and terminates at the Cerri Complex. This pipeline transports the natural gas received from the Neuquén Basin,
particularly from the Sierra Barrosa, Charco Bayo, El Medanito, Fernández Oro, Lindero Atravesado, Centenario, Río Neuquén and Loma de la Lata natural gas fields. The gas delivered from Neuba I Gas Pipeline is subsequently compressed and
injected into the Loop Sur Gas Pipeline and the General San Martín pipelines for transportation north to the greater Buenos Aires area. As part of the works scheduled to be completed in the five-year plan, we are executing the construction of
a compressor plant in the town of Confluencia, Neuquén Province, which will allow the Neuba I Gas Pipeline to be interconnected with the Neuba II Gas Pipeline and thus grant a greater degree of flexibility to the operation of the natural gas
transport system.
Loop Sur Gas Pipeline. This gas pipeline was built in 1972 as an extension of Neuba I Gas Pipeline and runs parallel to a portion of the General San Martín gas pipeline. Located in the province of Buenos Aires, it transports natural gas from the Neuba I
Gas Pipeline at the Cerri Complex in Bahía Blanca and terminates at the high pressure transmission ring around Buenos Aires, which we also operate. The natural gas delivered by this gas pipeline constitutes a portion of the natural gas supply
for the greater Buenos Aires area. Loop Sur Gas Pipeline is also connected to the TGN system and allows us to deliver natural gas to or receive natural gas from TGN. Such transfers occur occasionally during periods of high demand for natural
gas.
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Neuba II Gas Pipeline. Our newest natural gas pipeline, Neuba II Gas Pipeline, was built in 1988 and is our second pipeline serving the Neuquén Basin. Neuba II Gas Pipeline was expanded four times between 1996 and 2000, and again in 2008. Neuba II Gas
Pipeline begins at YPF’s Loma de la Lata gas treatment plant in the western portion of the basin and runs through the Provinces of Neuquén, Río Negro, La Pampa and Buenos Aires (through the Cerri Complex), up to its terminal station located
at Ezeiza just outside of Buenos Aires. Neuba II Gas Pipeline is a principal source of natural gas for the Federal District and the greater Buenos Aires area. In 2008, this pipeline was expanded as a part of the Second Expansion, resulting in
the construction of 153 miles of natural gas pipeline.
Other Pipelines. We
also operate the Cordillerano natural gas pipeline, built in 1984, which receives gas from the Neuquén Basin and supplies it mainly to three tourist centers in southern Argentina. In addition, we operate other minor pipelines, the high
pressure transmission ring around Buenos Aires, the Chelforó-Conesa natural gas pipeline and other natural gas pipelines known as natural gas transfer pipelines.
Additional information regarding the expansion of our gas transportation system is included in “Item 4. Our
Information—B. Business Overview—Natural Gas Transportation—Pipeline Operations.”
Ancillary Facilities
Cathodic Protection System
Currently, we operate cathodic protection devices, which are located along our main pipelines. The objective of this system is to prevent the
corrosion process. The corrosion process causes metal loss, which, depending on the severity of the damage, may cause pipeline ruptures. Cathodic protection equipment includes direct current rectifiers, and generators powered by thermic,
turbine natural gas engines in locations where no electric lines are available. The system also includes an impressed current anode, which facilitates circulation of electricity through the circuit formed by the generator, the anode itself, the
pipe and the land.
Measurement and Control of the Transport System
To guarantee the reliability of the facilities and optimize the operation of the transport system, it is necessary to have real-time information
from the various measurement and control devices installed throughout our more than 5,746 miles of gas pipelines and 32 compressor plants.
To that effect, we have fiscal measurement stations associated with gas receptions from producer facilities and gas deliveries to our
distributors or customers, in addition to the mediation equipment installed in the compressor plants to determine the volumes of pumped gas, fuel and other variables of operational interest.
All the information generated by the field devices is collected by our SCADA/EFM system, transmitted through our communications infrastructure
and centralized at our headquarters. The fiscal mediation information contains volumes and quality of gas, which is collected by the SCADA/EFM system and saved in a database for further processing by other corporate systems.
In addition, the information is shared in real time with producers, distributors and ENARGAS in order to ensure the required auditability and
transparency.
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Natural Gas Control System
Located at our Buenos Aires headquarters, the gas control system controls scheduled gas injections and deliveries and allows us to follow gas
flows in real time. Data is received from compressor stations by phone and automatically from remote terminal units (“RTUs”) installed in the receipt and delivery points equipped with the Electronic Flow Measurement (“EFM”)
system. The information is normally collected by the supervisory control and data acquisition system (which has an ad hoc database that is updated every 30 seconds on average) and is then consolidated into other databases. In order to control
gas injection and deliveries, we have developed a software system called Solicitud, Programación, Asignación y Control, which, among other things, allows us to control actual volumes and projected
future injections to determine producer deviations. As part of this system, we operate meteorological equipment and receive daily weather information from various sources, which is used for the purpose of forecasting natural gas demand.
Natural Gas Measurement
Shipped and delivered natural gas is measured through primary field facilities that are connected with RTUs. Such RTUs transmit the data to the
Buenos Aires headquarters. This data is utilized to prepare reports for clients, shippers, producers and ENARGAS. Energy balances are also prepared in order to control our system efficiency.
Liquids Production and Commercialization
Our Liquids production and commercialization activities are conducted at our Cerri Complex. It is located near the city of Bahía Blanca and is
connected to each of our main pipelines. The Cerri Complex consists of an ethane extraction cryogenic plant to recover ethane, LPG and natural gasoline, together with a lean oil absorption plant to recover LPG and natural gasoline. The facility
also includes compression, power generation and storage facilities. The Cerri Complex processing capacity is approximately 47 MMm3/d.
As part of the Cerri Complex, we also maintain at Puerto Galván a storage and loading facility for the natural gas liquids extracted at the
Cerri Complex. The Cerri Complex, including the Puerto Galván facility, is currently capable of storing 68,882 short tons of liquids. See this “Item 4. Our information—B. Business Overview—Liquids Production
and Commercialization.”
Midstream
As part of this business segment, we provide services related to natural gas including treatment, gathering and compression. As of the date of
issuance of this Annual Report, total compression capacity of our plants Plaza Huincul, Río Neuquén and El Chourron was 34,790 HP. Treatment services are provided by plants located in Plaza Huincul and Río Neuquen with a total capacity of 5.9
MMm3/d. Finally, conditioning services are provided Tratayén plant amounted to 28MMm3/d as of the date of issuance of this Annual Report.
Our assets in Vaca Muerta allowed us to provide solutions to our clients. Through the development of the Vaca Muerta System, which consists of
two pipeline sections totaling 183 km and a natural gas conditioning plant located in Tratayén, connected to the main pipelines operated by us (Neuba I and Neuba II), TGN (Central Oeste), and GPM. This Project executed since 2028 will be
pivotal in the development of Vaca Muerta natural gas reserves. The execution of these works demanded great commitment from our team and compliance with all the terms agreed with our customers.
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This pipeline system goes through several hydrocarbon fields, including Bajada de Añelo, La Calera, Bandurria Sur, Fortín de Piedra, El
Mangrullo, Aguada Pichana Este, Rincón la Ceniza, El Trapial, Los Toldos I Sur and Pampa de las Yeguas I and II.
In November 2024 and February 2025, we commissioned additional investments that allow us to expand our natural gas conditioning capacity and
increase our role in the Vaca Muerta development, including the installation of the Propak Plant to be operated in gas conditioning mode until we are able to develop a natural gas processing project in the Tratayén Plant. The Propak Plants may
be converted to allow processing of natural gas in the future, and they increased our conditioning capacity by 6.6 MMm3/day for each Propak Plant. With the
addition of the Propak Plants, our total gas conditioning capacity increased up to 28MMm3/d since February 2025. The total estimated investment for this expansion
was US$360 million.
Telecommunication
We own two interconnected networks beginning in the Buenos Aires Province, which consist of (i) a flexible and modern microwave digital network
with Synchronous Digital Hierarchy technology over more than 2,858 miles, which covers the Buenos Aires–Bahía Blanca–Neuquén routes to the West and the Buenos Aires–Bahía Blanca–Comodoro Rivadavia–Río Grande routes to the South, and (ii) a dark
fiber optic network of approximately 1,056 miles, which covers the La Plata–Buenos Aires–Rosario–Córdoba–San Luis–Mendoza routes. There is also a network in the Patagonia region, which consists of a “lit” fiber optic network of approximately
373 miles, which covers the Puerto Madryn–Pico Truncado route.
Environmental, Social and Governance
We are committed to managing its business and operating its facilities in compliance with the requirements of applicable legislation and the
requirements to which it voluntarily adheres, satisfying the expectations of its customers and prioritizing the quality of its services, the prevention of pollution and the health and safety of its personnel and contractors, through the
continuous improvement of the effectiveness of its management system.
In 2025 we continue to work on the Environmental, Social and Governance (ESG) Strategic Plan in which we prioritize these three thematic axes
and lines of action that will guide our purpose in this area. Focused on our mission and the role we seek to play in the communities where we do business, the general objectives of our ESG Plan are as follows:
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Environment
During 2025, we continued implementing the actions set forth in our 2022–2026 Environmental Strategic Plan, aimed at strengthening a corporate
culture focused on sustainability, prevention and environmental care.
Our environmental strategy is structured around three main axes: (i) mitigation and adaptation to climate change, (ii) proactive environmental
leadership, and (iii) circular processes and responsible consumption.
In connection with climate change mitigation, our strategy establishes a target to reduce methane emissions by 50% by 2030 compared to emissions
recorded in 2021. To support this objective, we implemented a comprehensive emissions action plan that includes technological upgrades, operational improvements and best practices. During 2025, we strengthened our emissions inventory by
updating emission factors in line with the latest IPCC assessment reports, reviewed internal emissions management procedures to ensure consistency and traceability, and advanced the identification of mitigation opportunities through
technological and operational improvements.
As part of our climate risk management approach, during 2025 we developed and implemented a climate resilience strengthening plan with a
nine‑month implementation horizon. This plan was executed through a transversal approach across the Company and focused on the review and reinforcement of processes, procedures, technologies and contingency measures aimed at anticipating,
adapting to and recovering from climate‑related impacts.
With respect to biodiversity and sustainable forestry, we executed forestry management plans at 34 facilities, including the planting of native
and locally adapted species and interventions on deteriorated specimens, contributing to biodiversity protection, soil improvement and climate change mitigation.
In the area of water and effluents management, we advanced toward our objective of achieving sanitary effluent treatment systems across all
operational sites by installing biodigesters at 13 additional facilities during 2025, enabling the recovery of effluents treated for irrigation purposes and improving water resource efficiency.
In addition, we continued strengthening circular processes and responsible consumption practices, including waste management initiatives aimed
at increasing recycling rates and improving traceability through integrated monitoring systems.
During the year, we completed maintenance audits of our Integrated Management System certifications under ISO 14001:2015, ISO 9001:2015 and ISO
45001:2018, covering 45 sectors through on‑site external audits and additional internal assessments.
Social
Throughout the year 2025, we consolidated our commitment to the development of talent and the creation of a positive work environment, main
cornerstones to leverage the cultural, digital and business cultural transformation we are pursuing. It was a year notable for the attraction of new talents, continuous training and the strengthening of leadership, characterized by initiatives
that directly impacted on our business sustainability.
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In the field of talent attraction, we conducted 102 recruitment processes, 16 of which were covered internally— thus promoting movement and
growth within the organization—, whereas 86 were hired from outside, bringing in new insights and experience to enrich our teams. As a relevant landmark of the year, we can point out at the launching of the Internship Program, which allowed us
to add 14 students in two stages of the year, taking in young energy and innovation. Besides, we participated in strategic events such as the Oil & Gas Exhibition in Buenos Aires, thus upholding our employer brand and positioning in the
sector. With the goal of generating local employment and contributing to the development of the nearby communities, we developed employability workshops for 210 technical schools students in Río Negro and Neuquén and supervised professional
practices in secondary schools, facilitating employability tools.
The year was filled with learnings, new recruitments and opportunities for our people. That is our recipe for building teams that make the
difference.
We cultivate a healthy and challenging work environment and we watch over the integral wellbeing of our people. For over ten years, we have been
one of the greatest places to work in Argentina, as certified by the global firm Great Place to Work. During 2025, we renovated the measurement of organizational climate with the Slik platform, which provides us with customized surveys,
real-time dashboards and artificial intelligence insights. In July 2025, we launched the climate survey, obtaining 75% positive perception of working at tgs and a Net Promoter Score of 52 points, indicators that underscore the strength of our
culture based on trust, development and wellbeing.
We devised a method to work on our strategy, businesses and culture in a comprehensive manner. 2030 Vision gathers people from different areas
of the Company, at different organizational levels and of different ages in pursuit of a common purpose: “To self-transform to transform.”
We identify which are the organizational qualities that we need to nurture to become the company we aim to be. Based on this diagnosis, we
devise mechanisms that allow us to do things in a different way to evolve in our decision-making, social bonds and daily execution of our tasks.
2030 Vision builds a bridge between today’s and the future EBITDA. We place people at our core and open opportunities so that we can be key
players in the future.
We keep promoting our organizational behaviors —pursuing more, placing the client at the core, innovating cooperatively— intensifying our
presence in daily performance, leadership spaces, and performance processes.
Likewise, we continue to advance our digital transformation, consolidating our change management cell. Organized as agile, cross‑functional
working cells, this capability serves as a strategic resource for driving the adoption of new tools, processes and work styles. Throughout 2025, we supported transversal projects —SAP S/4HANA and digital transformation initiatives, among
others— fostering communications, open talks and specific action devised to ensure that people embrace transformation and can blend it into their day-to-day performance.
For information regarding our employees and its geographical distribution see “Item 6. Directors, Senior
Management and Employees—D. Employees.”
Governance
We permanently seek to develop and improve our internal policies and procedures, adhering to the best international practices, with the main
purpose of protecting and enhancing our Company’s value for all our shareholders.
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Our Corporate Governance practices are regulated by applicable Argentine law, particularly, General Companies Act, the standards issued by the
CNV and other entitled entities, our Bylaws, as well as other documents approved by our Board of Directors. We are further subject to the standards and regulations of both the NYSE and the SEC.
Our Corporate Governance Goals are to ensure:
• Greater transparency in our performance, through the outlining of a culture of integrity and clarity in our business management.
• Adequate supervision through the continuous improvement of our internal control structure, leadership in compliance with regulations and adoption of policies addressed to achieve effective risk management.
• Proper allocations of accountability. Clear delineation of the scope of responsibility undertaken by the Board members and managers of the Company, related to compliance with internal policies and regulations.
Among the measures we implemented to ensure transparency in our actions, are the following components, among others, articulated into an
Integrity Program, in accordance with the provisions of the Corporate Criminal Liability Law No. 27,401:
Code of Conduct
Our Code of Conduct governs the behavior of our directors, statutory auditors, management members and employees of both us and our subsidiary.
Further, we seek to ensure acceptance of the Code of Conduct by our suppliers, independent contractors, consultants and clients. The Code of Conduct outlines indispensable ethics, transparency and honesty of the people who work at the Company.
It stipulates several obligations and it declares the prohibition to forge or tamper with any information or documentation, behave in a manner that may damage our Company or obtain any personal benefit against the interests of the Company. It
also stipulates that those who disclose information to the market must have full knowledge of and abide by the CNV Rules and SEC regulations and are under the obligation to report without misrepresentations.
Antifraud Policy
Our Board of Directors has issued an Antifraud Policy, that aims to outline roles and responsibilities and detect irregularities that may arise
in connection with the activities we perform.
Sustainability Policy
This policy provides the overall guidelines for conveying our sustainability vision into the development of our strategies and action programs,
consistent with business continuity and promoting bonds with our stakeholders.
Best Stock Market Practices Policy
This policy has been adopted to ensure greater transparency in purchase or sale transactions or any kind of operations on negotiable securities
listed in stock markets, preventing any person in our Company from obtaining any kind of advantage or economic benefit from the use of privileged information.
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Policy of Related Parties’ Approval and Disclosure
By means of this policy, we have devised mechanisms to detect and disclose related parties’ transactions, under the terms of Argentine Public
Offering Law No. 26,831.
Anti-Money Laundering Policy
This policy aims at preventing and detecting unusual or suspicious transactions, in accordance with the definitions of applicable law,
accounting standards and international standards.
Clawback Policy
We outlined this policy in 2023 to meet the standards approved by the SEC for companies listed in the NYSE and the National Association of
Securities Dealers Automated Quotation (“NASDAQ”). This policy standards aimed at regulating an eventual recovery of compensations erroneously awarded (claw back) to members of the Management Committee.
The Board of Directors at their meeting held on April 16, 2026, amended this policy to update de definitions of “Management Committee” and
“Executive Officer,” so as to include the Strategic Projects Vice President within the positions covered by the Clawback Policy, and to propose a provision stating that such definitions shall also encompass any other position that may in the
future be created, eliminated, or modified within the structure of the Executive Committee, with the purpose of keeping the Clawback Policy updated in light of any potential changes in our organizational structure.
Cybersecurity Policy
After the SEC issued new requirements that seek to regulate information disclosed regarding material cybersecurity incidents as from December
18, 2023, the Board of Directors meeting held on November 6, 2023 approved amendments to the Cybersecurity Policy, the Cybersecurity Incidents Management and the Systems Emergency Plan.
Under the framework of the SEC and in accordance with international standards ISO 27001 and C2M2, the Board of Directors meeting held on
November 3, 2025 approved an updated Cybersecurity Policy, which adds improvements as detailed below:
• Alignment of roles, responsibilities and controls to the international standards ISO 27001 and C2M2.
• Integration of information technology and operational technology to increase resilience and business continuity.
• Outlining of specific definitions and procedures related to the safe use of artificial intelligence.
• Strengthening our governance framework and incidents management, implementing prompt response mechanisms and clearly delineated responsibilities.
• Outlining complementary policies: Sensitive Information Classification and Protection Policy, Cybersecurity Risk Management Procedure, Information Technology Emergency Plan, Cybersecurity Incidents Management and Security Policy for Remote Working.
• Third parties’ risk management by means of contractual clauses and continuous evaluation procedures.
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These policies seek not only to comply with current regulations but also to provide transparency in disclosures and to manage cybersecurity
incidents more efficiently.
The Board of Directors expressly delegates in the Executive Committee the determination of the incident materiality and, if applicable, the
reporting of the incident. In order to determine the materiality of cybersecurity incidents, the following impacts shall be assessed: economic-financial or business, legal or regulatory, company reputation, people safety, quality and rendering
of services, environment and /or stakeholders.
We also conducted the annual revision of the cybersecurity risks matrix.
Risk Management
The permanent assessment of the environment is one of the pillars of our strategic planning, as a premise to guarantee the adaptation of the
Company to an uncertain context in continuous transformation. Risk management is, in particular, one of the essential tools to fulfil the need to adapt to the environment.
We have had our Global Risk Management Policy approved by the Board of Directors of the Company since the year 2018. In the year 2025 the Board
of Directors approved an amendment to such policy, to reflect our evolution has had in terms of risk management and to consolidate the progress achieved over the last years. The new Policy establishes the principles adopted by us in the field
of risk management and also defines the main responsibilities.
The principles, among others, include the outlining of a continuous, structured, systematic risk management that is also integrated to the
organizational culture and the implementation of a framework for risk management that ensures the identification, analysis, assessment, treatment, monitoring and control of them with effectiveness and efficiency through the Company’s processes.
In its supervisory role, the Audit Committee oversees the application and monitoring of our risk management policy and related developments.
Thus, the usual process of strategic risk management contemplates that once certain risk has been identified, the existent controls and
mitigating factors must be surveyed, weighed and mapped based on impact and likelihood factors. We also determine the “risk appetite” or acceptable level so that —according to the gap between such risk level and the performed assessment—, we
can establish the need to implement specific action plans, which are then followed-up to determine their advance status and effectiveness in light of the pursued objectives.
Our investment plan is based on risk prioritization, contemplating among others risks of different natures: operative, environmental, safety,
impact on community, non-compliance with requirements, cybersecurity. The strategic risk matrix includes a ESG risk category. This guarantees that the environmental, social and governance risks shall be regularly monitored by the Management
Committee, ensuring the follow-up of the effectiveness of the action plans delineated in each case in order to get the assessment of each risk to an acceptable level.
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Insurance
We maintain insurance, subject to deductibles, against third-party liability for damage to all of our facilities used in the Liquids and
Midstream business segments and our pipeline assets that pass under rivers or other bodies of water and the Strait of Magellan and business interruption. We believe this coverage is consistent with standards for international natural gas
transportation companies. The terms of the policies related to the regulated assets have been approved by ENARGAS. In addition, we have obtained insurance coverage for our directors and officers pursuant to a standard D&O insurance. For
additional information, see “Item 3. Key Information—D. Risk Factors—Risks Relating to Our Business—Our insurance policies may not fully cover damage or we may not be able to obtain insurance against certain
risks.”