Neuquen province approves YPF-Shell deal to invest around $447m


Argentina’s Neuquen province has authorised an agreement previously signed between Shell’s subsidiary and state-owned oil company YPF to jointly develop a hydrocarbons block in the Bajada de Añelo area with a potential investment of $447m.

The investment in the Province of Neuquén is expected to be made before 30 June 2022.

In February this year, Shell Argentina and YPF signed the preliminary terms and conditions of an agreement to develop a shale gas pilot project on a 50:50 basis in Vaca Muerta, Neuquén, with an investment of $300m.

At the time of signing the agreement, Shell Argentina Country chairman Teófilo Lacroze said: “Shell has demonstrated excellent results in an unconventional exploration in Vaca Muerta, and considers the local domestic gas market of high interest. 

"In collaboration with YPF, we expect to gain further understanding of the Vaca Muerta play."

“In collaboration with YPF, we expect to gain further understanding of the Vaca Muerta play. If the agreement is reached, we would be further contributing to develop the energy potential of our country.”

Spread over 204km², Bajada de Añelo is located north-east of Loma Campana, a strategic region in Vaca Muerta that has both shale oil and shale gas resources.

In January this year, Argentina signed agreements with different companies, including YPF, Shell, Chevron, Total and BP unit Pan American Energy, seeking combined investments of around $5bn in the Vaca Muerta play.