YPF, American Energy Partners to Develop Argentina Oil, Gas Projects
January 14 2016 - 5:00PM
Dow Jones News
BUENOS AIRES—Argentina's YPF SA and American Energy Partners LP,
run by energy industry veteran Aubrey McClendon, signed a deal
Thursday to jointly explore and develop unconventional oil and gas
projects in the South American nation, the chief executive of the
Argentine state-run oil firm said.
The deal, the latest in a series of international joint ventures
by YPF, underscores growing global interest in Argentina's Vaca
Muerta—or "dead cow"—shale formation, located in the Patagonian
Province of Neuqué n.
Drilling in Vaca Muerta has already turned Argentina into the
world's top shale producer outside of North America.
YPF expects Mr. McClendon and his engineers to introduce a new,
more competitive approach to producing unconventional energy in
Argentina.
"We are adding someone with experience that will speed up our
learning curve," Miguel Galuccio, YPF's chief executive, said in an
interview. "This will introduce a kind of healthy competition that
all players will benefit from, as early wildcatters and smaller
companies did early on in the development of the U.S. shale
industry."
American Energy Partners couldn't immediately be reached for
comment.
YPF and American Energy Partners plan to drill more than 20
wells, most of them to horizontally fracture ancient shale rock,
according to people familiar with the agreement. They will also
build gas-treatment facilities, these people said.
One project entails launching a pilot program in the "Bajada de
Añ elo" block, a roughly 55,000-acre area in Vaca Muerta. Another
project involves a partnership between YPF, American Energy and two
other companies to development shale gas in "Cerro Arena," a nearly
92,000-acre block.
Mr. McClendon formed American Energy in Oklahoma City in 2013
after being ousted as chief executive of Chesapeake Energy Corp., a
company he co-founded. Mr. McClendon helped turn Chesapeake into an
unconventional oil-and-gas powerhouse. But during his tenure,
Chesapeake took on debt that is now threatening the company due to
extremely low oil and gas prices.
YPF has already signed multibillion-dollar deals with companies
including Chevron Corp. and Malaysia's Petroliam Nasional Bhd, or
Petronas. Last month, it reached a $500 million shale-gas deal with
Dow Chemical Co.
YPF plans turn over operations to American Energy, representing
a departure from YPF's ventures with Chevron, Dow Chemical and
Petronas. The thinking is that this would make it easier for Mr.
McClendon's team to tap its vast experience in developing shale
basins.
American Energy's plans come after it bought more than 55
million acres of land in Australia in hopes of developing
oil-and-gas projects there.
YPF and its partners have invested more than $3 billion to
develop unconventional oil and gas in Argentina. Agreements are
already in place with Chevron and Petronas that could lift that
amount to more than $25 billion over the next 15 years.
Write to Taos Turner at taos.turner@wsj.com
(END) Dow Jones Newswires
January 14, 2016 16:45 ET (21:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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