Skip to comments.Chevron, YPF to spend $1.2B to develop shale resources in Argentina
Posted on 07/17/2013 5:02:35 AM PDT by thackney
Chevron and Argentinian oil firm YPF have inked a deal to spend $1.2 billion to further develop shale oil and gas resources in the Vaca Muerta formation in Argentina.
San Ramon, Calif.-based Chevron said Tuesday that the deal calls for an initial phase in which 100 wells will be drilled in a 5,000-acre tract in the Loma La Lata Norte and Loma Campana areas.
Chevron said the deal gives it the chance to grow production beyond its 2017 target of 3.3 million barrels per day.
The Vaca Muerta formation is a giant shale oil and gas field that was discovered in 2010 by Spanish oil and gas firm Repsol and YPF. Repsol once owned a majority stake in YPF, but now holds a much smaller stake.
Chevron Argentina currently produces an average of 21,000 barrels of crude oil and 4 million cubic feet of natural gas in the Neuquen Basin. The Loma La Lata area is currently producing more than 10,000 barrels of oil-equivalent per day.
This strategic investment will allow Chevron to take part in the Vaca Muerta, one of the most exciting shale oil and gas plays in the world today, Chevron vice chairman George Kirkland said in a statement.
YPF said that Chevron will spend the first $300 million of the total planned outlay once a concession is granted by local officials. After that, both companies may continue with the total development of the areas, YPF said.
YPF said that money it has already spent on the project together with the new contribution outlined in the deal with Chevron mark a total investment of $1.5 billion.
Argentina Nationalized YFP and took Repsol ownership. They have threatened legal action against companies looking to invest in YFP. Is this legal for Chevron? Maybe the loophole is the deal is a Joint Venture. If Legal, Chevron at the very least, is a bunch of SOBs.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.