"Signing a deal between Repsol and the Argentine state will provide the confidence necessary to form new alliances with potential investors and drive non-conventional exploration,"YPF chief Miguel Galuccio told Reuters on Wednesday.
Argentina, stands to become a major oil and gas producer as well, if the government can attract the tens of billions of dollars it needs to exploit the Vaca Muerta (Dead Cow) shale formation.
Argentina, stands to become a major oil and gas producer as well, if the government can attract the tens of billions of dollars it needs to exploit the Vaca Muerta (Dead Cow) shale formation.
YPF is the biggest stake-holder in Vaca Muerta. The company estimates the field contains 661 billion barrels of oil and 1,181 trillion cubic feet of natural gas, making it one of the biggest shale reserves in the western hemisphere.
Despite Vaca Muerta's vast potential, investment in the formation has come slowly so far.
Dow Chemical Co has signed on to invest up to $120 million in 16 Vaca Muerta gas wells, and U.S. oil company Chevron Corp has agreed to invest $1.24 billion in the area.
To clinch the deals, Argentina has allowed the companies to export tax-free up to 20 percent of what they produce. Export revenue of companies that invest at least $1 billion over five years is exempt from government foreign exchange controls.
Source: Reuters
