BUENOS AIRES, Oct 9 (Reuters) - Argentina's Senate early on Thursday approved a bill aimed at increasing incentives to lure the foreign investors needed to develop its vast shale reserves and erase the country's costly energy deficit.
The cash-strapped South American country, which defaulted on its debt in July and cannot tap global credit markets, needs investment of as much as $200 billion over the coming 10 years to exploit its vast Vaca Muerta oil and gas formation in Patagonia.
The bill passed the Senate 38 to 28 in the early hours of Thursday morning after a marathon debate, and is expected to pass in the lower house Chamber of Deputies later this month.
Under the country's 1967 energy law, regional governments issue licenses and determine concessions and the taxes that foreign companies pay. The bill would reform that law to establish a national framework.
The central government says the bill is needed to make it easier for foreign energy companies to do business in Argentina.
"This is a law to generate a process of investment," said Miguel Angel Pichetto, the head of the government coalition in the Senate, during the debate.
"You cannot have different policies in terms of royalties. You need to fix a political framework that will generate an estimated billions of dollars."
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