YPF Approaches Acquisition of TotalEnergies’ Shale Assets in Argentina

Argentina’s energy company YPF is reportedly close to finalizing a deal to acquire shale assets owned by the French energy giant TotalEnergies. According to information from Bloomberg, which cites unnamed sources, the transaction could be valued between $400 million and $500 million.

Vaca Muerta’s Growing Importance

The assets in question are part of the underdeveloped regions of the Vaca Muerta shale formation, which is recognized as one of the largest shale deposits globally. Estimates indicate that this formation contains recoverable resources of approximately 16 billion barrels of oil and 308 trillion cubic feet of natural gas.

YPF has been actively involved in the development of other parts of the Vaca Muerta formation, seeking to capitalize on opportunities within what many industry experts consider the world’s second-largest shale gas deposit. The company has already drilled over 800 wells in the area from 2015 to 2021, according to data from Enverus. This positions YPF as the most active developer in Vaca Muerta, significantly ahead of its nearest competitor, Tecpetrol, which drilled only 150 wells in the same period.

TotalEnergies has also been a notable player in the Vaca Muerta region, matching Tecpetrol’s activity with 150 wells. Currently, YPF accounts for 55% of the oil production and 45% of the natural gas production in the shale play, with Tecpetrol as a partner, as reported by Rystad Energy.

Boosting Energy Security and Investment

The Argentine government views the Vaca Muerta shale play as vital for attracting foreign investment and enhancing the nation’s energy security. By increasing domestic production, Argentina aims to reduce its dependence on imported energy resources. Recent government policies under President Javier Milei have focused on promoting foreign investment in the energy sector, contributing to a rise in production from less than 90,000 barrels per day five years ago.

As YPF moves closer to acquiring TotalEnergies’ assets, the stakes in Argentina’s energy landscape continue to rise. The potential deal not only signifies YPF’s commitment to expanding its operational footprint in Vaca Muerta but also underscores the increasing significance of this shale play on the global energy stage.