Repsol and Argentina reached a preliminary deal on Monday for the Spanish oil major to get paid for the 51 percent stake in the South American's country's main energy company YPF YPF.PA that the Argentine government seized in 2012.
If the deal is approved by Repsol at a board meeting scheduled for Wednesday in Madrid, it could spark a wave of international investment in Argentina's vast Vaca Muerta shale oil and gas formation.
Spain's government was proposing Repsol receive $5 billion in compensation and that both Repsol and YPF each name investment banks to advise on the valuation of the stake seized, said one source.
After the 2012 expropriation of YPF, Repsol lodged a complaint with the World Bank arbitration tribunal, the International Centre for Settlement of Investment Disputes and has threatened to sue any company that partners with YPF.
The chairman of La Caixa bank , Isidro Faine, and Emilio Lozoya, the chief executive of Mexican oil company Pemex, joined Spanish minister Jose Manuel Soria for the talks with the Argentine government of Cristina Fernandez and Miguel Galuccio, the chairman of YPF, sources told Reuters.
The Argentina government said in a statement it had struck an initial compensation deal with the Spanish firm including liquid assets. In return, Repsol would drop its complaint to the World Bank, it said.
Source: Reuters
