A subsidiary of Chevron Corporation (NYSE: CVX) has signed an agreement with affiliates of the Argentine oil company YPF S.A. (NYSE: YPF) that furthers the development of shale oil and gas resources from the Vaca Muerta formation located in the Neuquén province.
The agreement calls for initial outlays of approximately $1.24 billion to enable the first phase of development in the Loma La Lata Norte and Loma Campaña areas. The initial program will include the drilling of 100 wells in a 5,000-acre tract, part of a 96,000-acre concession.
"This strategic investment will allow Chevron to take part in the Vaca Muerta, one of the most exciting shale oil and gas plays in the world today," said George Kirkland, vice chairman of Chevron Corporation. "It provides Chevron with a new opportunity to profitably grow production beyond our 2017 production target of 3.3 million barrels per day."
"Chevron has a long history in Argentina, and this project demonstrates our commitment to the country, its economic development and its goal of achieving energy self-sufficiency," said Ali Moshiri, president, Chevron Africa-Latin America Exploration and Production.
The Loma La Lata field is currently producing more than 10,000 barrels of oil-equivalent per day.
Chevron Argentina currently produces an average of 21,000 barrels of crude oil and 4 million cubic feet of natural gas in the Neuquén Basin, where it holds operated interests ranging from 18.8 to 100 percent.