Argentina hydrocarbons watch: Mendoza project call, production incentives rules

Bnamericas Published: Tuesday, January 17, 2023

Officials in Argentina’s Mendoza province are analyzing 14.8bn pesos (US$81.2mn) in hydrocarbons projects presented during the final round of a local investment incentives program.

Seven operators presented 18 projects, encompassing areas including well repair and workover, drilling and abandonment. 

“Currently, these projects are in the applicability evaluation phase from a technical-economic perspective, in accordance with the terms and conditions of the program,” the provincial government said in a statement. 

Combined, previous rounds of the program – whose initial goal of reactivating 200 wells has already been surpassed, by around 100 – have attracted 10bn pesos. 

Mendoza oil production is around 8,800m3/d or 268,400m3/month, according to federal energy department data. The provincial government said it aimed to reach 300,000m3/month by end-2026.

Under provincial program Mendoza Activa Hidrocarburos, qualifying companies obtain tax credits that can be used against provincial taxes and royalties.

State hydrocarbons company YPF has already committed US$17mn to explore for unconventional oil in Mendoza’s slice of the Vaca Muerta shale play.

Mendoza, where output is almost all conventional, is planning to auction 12 blocks this year.


The federal energy department has issued further rules concerning a national program designed to spur hydrocarbons production by offering producers access to the foreign exchange market.

Argentina has capital controls to help defend the battered peso. Under the program, qualifying firms that ramp up output will be able to exchange a proportion of associated revenue to another currency. 

The latest rules, issued via resolution, encompass areas such as eligibility and documentation requirements and benefit-calculation mechanisms. They complement the central decree, No. 277 of May 2022, which outlined the regime.

Upstream firms are pressing the production accelerator, with appetites whetted by favorable prices on the international market, geopolitical shifts and investment in local midstream infrastructure. Because of domestic refining capacity restrictions, Argentina has to import some grades of gasoline and diesel, with new crude output being channeled to exports.

Click here for further information

Subscribe to the most trusted business intelligence platform in Latin America. Let us show you our solutions for Suppliers, Contractors, Operators, Government, Legal, Financial and Insurance.

Subscribe to Latin America’s most trusted business intelligence platform.

Other projects in: Oil & Gas (Argentina)

Get critical information about thousands of Oil & Gas projects in Latin America: what stages they're in, capex, related companies, contacts and more.

  • Project: Block CN-V
  • Current stage: Blurred
  • Updated: 3 months ago

Other companies in: Oil & Gas (Argentina)

Get critical information about thousands of Oil & Gas companies in Latin America: their projects, contacts, shareholders, related news and more.

  • Company: Oleoductos del Valle S.A  (Oldelval)
  • Oleoductos del Valle S.A (Oldelval) was founded in 1993 as an oil transportation company. It is responsible for the development, operation and maintenance of Argentina's 1,700 k...
  • Company: Siemens S.A.  (Siemens Argentina)
  • Siemens Argentina is the local unit of German electrical engineering and electronics firm Siemens. Siemens has been present in the country since 1857 and has offices in Buenos A...
  • Company: Pampa Energía S.A.  (Pampa Energía)
  • Founded in 2005, Pampa Energía is an Argentine integrated energy company owned by Grupo Emes. The company engages in the generation, transmission, and distribution of electricit...
  • Company: Compañía General de Combustibles S.A.  (CGC)
  • Argentina-based Compañía General de Combustibles S.A. (CGC) is engaged in hydrocarbons exploration and production, as well as gas distribution within Argentina and towards Chile...
  • Company: Ledesma S.A.A.I  (Ledesma)
  • Ledesma S.A.A.I is an Argentine agribusiness company specializing in the production of sugar and paper, also acting in the fruit, juice, meat, cereal, alcohol, corn syrup and st...
  • Company: Gasnor S.A.  (Gasnor)
  • Gasnor is an Argentine distributor of piped natural gas serving Tucumán, Salta, Jujuy and Santiago del Estero provinces. The firm was created in 1992 after the privatization of ...
  • Company: Capex S.A.  (Capex)
  • Capex is an energy integrated company dedicated to exploring and exploiting hydrocarbons, as well as to electricity generation in Argentina. It produces oil and gas at the Agua ...