SNAPSHOT: Top 5 unconventional O&G projects in Argentina

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Tuesday, November 29, 2016

LA AMARGA CHICA

The respective state-owned oil companies of Argentina and Malaysia, YPF and Petronas, announced an agreement last week to extend their 50:50 shale pilot JV at the La Amarga Chica shale oil field.

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The firms will invest US$193mn in the drilling of 10 horizontal wells during the pilot's second phase.

LOMA CAMPANA

Horizontal well costs at the Loma Campana license targeting Vaca Muerta averaged US$9.5mn/well for YPF, the company said in its third-quarter earnings presentation, down from US$16.2mn/well in 2013.

Conversely, the average amount of frac stages per well grew to 17.3 from 8.8 during the same span.

Good productivity from horizontal wells in Loma Campana helped drive growth in shale oil production during the quarter, YPF said.

The 51% state-owned firm said in March that it planned to drill 54 shale wells this year, of which 40 were planned for Loma Campana, a 50:50 JV with Chevron.

EL OREJANO

The CEO of Dow Chemical Argentina, Gastón Remy, said recently that accumulated investment at the El Orejano shale gas JV with YPF was expected to reach US$700mn by end-2017 and US$2bn over the coming years.

Remy said that the project had "completely exceeded our expectations."

Treatment capacity at El Orejano has reached 2.5Mm3/d, YPF said, allowing shale gas output to increase. In the Q3 presentation, YPF cited, "promising results in an extended well in El Orejano (2,000m lateral length and 27 frac stages) with 400,000m3/d peak production."

RÍO NEUQUÉN

The Río Neuquén concession in the Neuquén basin is shared by Pampa Energía, Petrobras and YPF, and is considered to have high growth potential because of its shale and tight gas resources.

These unconventional resources have the potential to more than double the value of the asset, according to analysts at Raymond James.

SIERRAS BLANCAS

The local unit of Royal Dutch Shell said it expects to bring nearly 2,500b/d of shale oil production on stream by year-end at the Sierras Blancas concession in the Neuquén basin, once construction of an early production facility at the site is complete.

Shell plans to invest US$300mn/y in Argentina through 2020, with the funds going toward both upstream and downstream activity.