The construction of a green hydrogen refinery in Paysandú, Uruguay, which is across the river from Colón, Argentina, has sparked a new conflict between the two nations over environmental concerns. The project, backed by HIF Global, a multinational electrofuels company, recalls past tensions surrounding a previous pulp mill conflict between the countries. Uruguayan officials indicate that the current situation mirrors the historical disputes, warning of potential adverse effects on Argentina's environment and public health.

In December 2022, the Uruguayan government signed a memorandum of understanding with HIF Global, detailing a commitment to invest $5.3 billion into the green hydrogen initiative. This agreement aims to provide a roadmap for the project’s progression, although the environmental implications are being heavily scrutinized by Argentine authorities. A federal prosecutor in Argentina has already initiated an investigation into the potential environmental damage, raising awareness among local communities who are concerned about the plant’s impact on their health and ecosystem.

The situation underscores longstanding tensions between Argentina and Uruguay regarding environmental policies and cross-border industrial projects. As the green hydrogen refinery moves forward, both countries will need to address these environmental concerns to avoid a repeat of previous conflicts that affected diplomatic relations. The outcome of this investigation could greatly influence the future of projects of this nature in the region, impacting both environmental policy and international cooperation between the neighboring nations.