Don't display this message again [x]

Dear User,

On March 28, 2015 OilCareers and Rigzone will be coming together to provide you with access to the world’s largest resource for Oil and Gas news, jobs and industry insights.

We have recently updated our Terms & Conditions to accommodate these changes. Please read them carefully. By using the Site, you agree to be bound by these terms and conditions. These Terms and Conditions are effective as of March 30, 2015.

Finance & Investing
News Services
Get free industry updates via email.
Daily News
Weekly News
Equipment Updates
Weekly Job Register
Monthly Event Guide
Our privacy


Argentina's YPF, Chevron Sign Exploration MOU

change text size
Argentina's YPF, Chevron Sign Exploration MOU

BUENOS AIRES - Argentina's top oil and gas producer, state-run YPF SA, and Chevron Corp. have signed a memorandum of understanding to explore for unconventional energy in the South American nation.

The news, unveiled by YPF in a statement Friday, comes as YPF Chief Executive Miguel Galuccio seeks funding and international partners to carry out an ambitious exploration and production plan over the next five years.

But immediately after the statement's release, the Spanish oil company Repsol SA said it will try to prevent Chevron and YPF from working together.

Argentina's government expropriated YPF from Repsol earlier this year and it has not publicly offered to compensate the Spanish company for the loss of its unit. Repsol is seeking up to $10 billion in compensation.

"Repsol will take legal action against this agreement. We do not plan to let third parties benefit from illegally confiscated assets. Our legal teams are already studying the agreement," Repsol Spokesman Kristian Rix said in an emailed statement.

YPF declined to comment on Repsol's plans.

The memorandum between YPF and Chevron cites plans "to explore unconventional hydrocarbon development opportunities in Vaca Muerta...," YPF said in the statement. The statement did not include additional details of specific plans.

Vaca Muerta, located in the province of Neuquen, is thought to be home to massive shale oil and shale gas resources.

Argentina ranks third in the world, behind China and the U.S., in potentially recoverable shale-gas reserves, with 774 trillion cubic feet, according to a study last year by the U.S. Energy Information Administration.

Since Argentina's government expropriated YPF, Mr. Galuccio has been pushing hard to find the partners and money necessary to exploit those resources and boost overall production.

"With partners as important as Chevron...I'm sure that this is just the first step in a relationship that will be long and important," Mr. Galuccio said in the statement.

Ali Moshiri, Chevron's president of Latin America and Africa, was similarly upbeat, according to the statement.

"We are satisfied to be accompanying YPF in this new process and the whole [energy] sector will benefit from it," Mr. Moshiri said.

Chevron Media Advisor James Craig said the two companies have been collaborating together since the early 1990s.

YPF needs to raise fresh cash to fund a multi-billion-dollar investment plan between 2013 and 2017 that aims to reverse years of falling output and reserves.

In a recent presentation, Mr. Galuccio said YPF can invest $24.7 billion from its own pocket through 2017, with investment rising to $40.4 billion if the company is successful in inking joint ventures and obtaining outside financing.

Mr. Galuccio also recently met with executives from Russia's Gazprom to gauge support for joint ventures in Argentina.

Mr. Galuccio has acknowledged that some investors won't be interested in partnering with the company because of the way YPF was expropriated from Repsol.

But he has also voiced confidence that investor interest will rise once YPF is able to start showing concrete results from its exploration and production program.

Copyright (c) 2012 Dow Jones & Company, Inc.


Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies

Most Popular Articles
From the Career Center
Jobs that may interest you
Senior Sales Representative
Expertise: Business Development|Sales & Marketing|Technical Sales
Location: Texas or surrounding states, TX
Engineering Manager
Expertise: Engineering Manager
Location: Marinette, WI
BI Developer
Expertise: Business Development|IT - SAP / ERP
Location: Houston, TX
search for more jobs