Pluspetrol to invest in Vaca Muerta

BUENOS AIRES, April 26, 2017 – During a conference on Wednesday, Omar Gutiérrez, governor of Argentina’s Neuquén province, said that Pluspetrol would enter the Centenario Centro block under a 35-year production licence.

The company plans to invest USD 160 million through 2019 in a pilot project aimed at producing natural gas from the Vaca Muerta shale play. As part of the pilot project, the Argentinian operator will drill 35 wells in the 130-square-kilometre block by 2020.

The project will enable Pluspetrol to determine whether or not an additional investment of up to USD 350 million for further development is feasible. This possible second wave of investment could see the number of wells drilled in Centenario Centro reach 100.

The announcement follows several other investment commitments in 2017 for Vaca Muerta projects. So far, Tecpetrol, Shell, YPF, Total and ExxonMobil have all stated intentions to carry out projects targeting the production of shale and tight oil and gas from the unconventional formation.

Argentina’s energy authorities have been trying to boost interest in Vaca Muerta to reverse the country’s gas import trends and shrink government debt.

In March 2017, President Mauricio Macri announced a new incentive programme that would see USD 7.50 per million Btu of gas paid in 2018. After that, the price would fall USD 0.50 per year until 2021, when producers will be paid USD 6 per million Btu of gas.

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