YPF joins Petrolera Pampa to ramp up production from Neuquen shale block

Argentine flags on Plaza de Mayo
Source: DollarPhotoClub

Argentine state energy company YPF announced on Wednesday that it has expanded its existing agreement with Petrolera Pampa, a subsidiary of Pampa Energía – the largest electricity company in Argentina – with the view to developing the Rincon del Mangrullo shale-gas block in the southwestern province of Neuquen.

Rincon del Mangrullo covers the area of 183 square kilometres (45,200 acres) and is to undergo a two-stage development with the drilling of 34 wells in the first stage, and another 15 wells in the second stage.

Back in July 2014, YPF launched transmission on a $75 million, 55-km gas pipeline in the Neuquen province which was set to help boost production at the Rincón del Mangrullo block by 35 MMcf/d. Now, the new agreement aims at boosting daily production from the block to 4 million cubic meters (140 million cubic feet) through the planned construction of a new treatment plant and pipelines that will double gas-treatment capacity.

“This new deal contemplates the investment of $150 million more, with each company financing half of that, to develop infrastructure,” YPF said.

On top of that, Petrolera Pampa would invest an additional $22.5 million to drill new wells, as well as an up to $40 million to launch an exploratory program in the nearby Lajas Formation for the 2015-2016 period, with Pampa Energia accounting for 85 per cent of the total investment outlay.

“Total investment by both companies this year could reach $350 million,” YPF said.

The second on the list of countries with technically recoverable shale gas resources and fourth for oil, Argentina is home to 802 trillion cubic feet of natural gas and 27 billion barrels of recoverable oil. The deposits are primarily located in and around multiple prolific shale basins in the central Neuquen province, including the prized Vaca Muerta shale.

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