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New Vaca Muerte blocks to be auctioned this month

02nd May 2014

Argentina's Neuquen province will be inviting international supermajors to bid in a May auction of 11 oil blocks, its energy minister said this week.

New Vaca Muerte blocks to be auctioned this month
The Neuquen basin's crude output accounts for over a third of the country’s oil production with 224,000 barrels per day (bpd) in 2013.

Most the blocks are within the highly productive Vaca Muerte shale formation and are thought to contain large reservoirs of conventional and unconventional resources

"For unconventionals, the players will be the majors," said Guillermo Coco, Neuquen energy minister whilst on a capital-raising trip to Houston. "Chevron, Exxon, Shell have shown interest in Vaca Muerta. They will compete for sure."

Interested companies would have to form joint ventured with the Argentine state oil and gas company, Gas y Petroleo de Neuquen (GyP), at 50-90 per cent stakes.

"We want to be the minority stakeholders in all the unconventional projects and also be an important stakeholder in conventional developments," said Coco.

The results of the bidding process are expected for August.

The Neuquen basin's crude output accounts for over a third of the country’s oil production with 224,000 barrels per day (bpd) in 2013.

There have been three previous bidding rounds for blocks in the region and at least 57 have already been assigned. Some of those previously offered blocks were handed back to GyP and are now up for re-sale.

U.S.-based Chevron has been the most active foreign oil company in Vaca Muerta in partnership with Argentine state-run company YPF SA.

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