Shell and Total will invest US$550 million with provincially owned Gas y Petroleo de Neuquén Oil Neuquen (GyP) to develop two shale oil and gas pilot projects. The investments reaffirm the commitment of oil majors to explore one of the world’s largest shale formations, known as Vaca Muerta, even after the world oil prices fell to five-year lows, officials said.
“Investments in Vaca Muerta are for the long term and will not be impacted by day-to-day variations in oil prices,” said a provincial energy official in Neuquén who withheld his name because he was not authorized to talk to the media.
The investment with Shell Argentina, worth a total US$250 million, will finance exploration in the Sierras Blancas and Cruz de Lorena blocks. Shell confirmed the details yesterday.
“The pilot plan will include drilling commitments in each block and a central treatment plant for oil and gas with a capacity of 10,000 barrels per day,” GyP said in a statement.
GyP also announced a US$300-million investment with Total Austral for a separate Vaca Muerta oil and gas pilot project.
Date: November 2, 2014