American Energy Partners signs Vaca Muerta agreement with YPF

American Energy Partners LP (AELP) and YPF SA have signed a joint venture to develop shale gas from the Argentina’s vast Vaca Muerta formation. The deal includes investments of more than US$500 million over the next three years.

One project consists of launching a shale oil and gas development pilot in the Bajada de Añelo block, covering 200 square kilometers (55,500 acres). After this first stage is completed by mid-2018, the project would enter into a full field development phase. In addition, YPF and an affiliate of AELP, in partnership with Pluspetrol and Gas y Petróleo de Neuquén, will launch a second project to delineate shale gas resources in the southern portion of the Cerro Arena block, covering 375 square kilometers (92,600 acres).

Under these agreements, an affiliate of AELP would earn up to 50% participating interest in the blocks. Thus, YPF incorporates a new strategic partner to accelerate the development of the Vaca Muerta shale play. AELP, an oil and gas asset management platform and operator with a management team that has drilled more than 15,000 horizontal shale wells throughout the US, is led by former Chesapeake Energy Corp. co-founder and CEO Aubrey McClendon.

AELP will join the development of Argentina´s shale resources alongside Chevron, Dow, and Petronas, which already have ongoing shale projects targeting Vaca Muerta.

 

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