Malaysia’s Petronas and Argentina’s YPF are to invest $550 million to jointly explore shale oil in Argentina’s vast Vaca Muerta shale.
Vaca Muerta is a geologic formation of Jurassic and Cretaceous age, located at Neuquén Basin of Mendoza Shelf in Argentina. The US EIA estimates total recoverable hydrocarbons from Vaca Muerta Formation to be 16.2 billion barrels of oil and 308 trillion cubic feet of natural gas, while in February 2012, Repsol YPF SA raised its estimate of oil reserves to 22.5 billion barrels.
Petronas and YPF signed the deal in Kuala Lumpur after telephone talks between Argentine President Cristina Kirchner and Malaysian Prime Minister Najib Razak, YPF said in a statement.
“The two companies will at the same time evaluate expanding their strategic partnership to other exploration areas with potential for non-conventional resources,” said the Argentine firm.
According to the agreement, Petronas will contribute $475 million of the total investment in the Amarga Chica block of Vaca Muerta formation. YPF has signed similar exploration deals with American Chevron and Dow Chemical. Other firms, American, French, and German, are all pursuing independent exploration in the Vaca Muerta formation.
YPF, which has the rights to more than 70 per cent of the 180 wells currently being developed at Vaca Muerta, is keen to form joint ventures with foreign investors to benefit from the technical knowledge experienced foreign companies can bring.
Article continues below this message
Have your opinion heard with Shale Gas International
We accept interesting, well-written opinion and analysis articles of up to 1,500 words, that offer unique insights into the shale industry. The articles cannot be overtly promotional in nature and need to fit into at least one of our content categories.
If accepted, the article must be exclusive to Shale Gas International website and cannot appear on any other websites, publications, etc. Each article may contain up to three links to external websites relevant to the content discussed in the piece.
If you would like to contribute to Shale Gas International website, please contact us at: editor[at]mw-ep.com