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YPF announces discovery of huge unconventional shale oil deposits in Mendoza

Friday, March 30th 2012 - 07:31 UTC
Full article 39 comments

Argentina's biggest energy company YPF, has found unconventional shale oil and natural gas in Mendoza province, confirming the extension of the massive Vaca Muerta area, officials said on Thursday. Read full article

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  • GreekYoghurt

    Pity they're not capable of extracting shale oil deposits without completely destroying the environment. That's if they're able to do it at all, given the technology required. Kind of desperate that they're resorting to shale anyways, rather than just finding crude deposits which I guess they don't have.

    Also it seems they care about the environment in the Falklands (not their country), but not in Mendoza (their country). How very Argentinian.

    Mar 30th, 2012 - 07:43 am - Link - Report abuse 0
  • Doveoverdover

    Great time to make an announcement though. Timed ,entirely coincidently, to take a bit of the wind out of the sails of any positive announcement from British oil companies operating in the South Atlantic.

    Mar 30th, 2012 - 07:57 am - Link - Report abuse 0
  • Malvinero1

    the environment. That's if they're able to do it at all, given the technology required. Kind of desperate that they're resorting to shale anyways, rather than just finding crude deposits which I guess they don't have.

    Which country has the most shale gas reserves outside of the United States and China?

    Canada? Nope.

    Australia? Wrong again.

    According to the U.S. Energy Information Administration (EIA), Argentina ranks third in recoverable shale gas reserves. Argentina has 774 trillion cubic feet (Tcf) of technically recoverable shale gas resources, with more than half of that in the Neuquén Basin on the western side of the country.
    http://www.investmentu.com/2011/October/shale-gas-boom-in-argentina.html
    yogi: You are an ignorant!

    Mar 30th, 2012 - 07:58 am - Link - Report abuse 0
  • brit abroad

    malv i dont think anyone was stating that you had no shale, you nonce.

    Mar 30th, 2012 - 08:01 am - Link - Report abuse 0
  • Rufus

    @3 Malv
    I think it might be the US (between the Piceance Basin, the Green River Formation and the Uinta Basin, all of which have more than a trillion (10^12) barrels of kerogen), then Russia (the Olenyok, Volga, St Petersburg and Vychegodsk Basins), then I believe it's the Congo (which has about 100 bbls of kerogen)

    As Brit Abroad says, having the oil shale to extract the kerogen (shale oil) from isn't difficult, actually being able to do something useful with it without leaving a mess of epic proportions is more of a problem.

    Mar 30th, 2012 - 08:44 am - Link - Report abuse 0
  • GeoffWard2

    All that's needed for its extraction and distribution is a watertight RoR to Repsol and the right to do with its profit what it will.

    This will not happen,
    so in the ground it stays.

    Mar 30th, 2012 - 10:01 am - Link - Report abuse 0
  • lsolde

    Hopefully it will stay there until we take over.
    They may have forgotten about it by then.
    l have been told that they have the attention span of a retarded goldfish.
    l've just been told...........it may not be true, it may be less.

    Mar 30th, 2012 - 11:18 am - Link - Report abuse 0
  • Ken Ridge

    @3 malv

    ”According to the U.S. Energy Information Administration (EIA), Argentina ranks third in recoverable shale gas reserves”

    Then get on with it, quit twittering on about Falklands oil and gas and do it yourselves for a change, I'm sure Cristina has enough small change in her purse to get it started.

    Mar 30th, 2012 - 11:32 am - Link - Report abuse 0
  • yankeeboy

    YPF needs U$25 BILLION and 10 yrs to develop these tight formations. So what's the plan for the next decade? And where does CFK think the 25B will come from? It's more than 1/2 of the whole country's reserves!! And 5x current FDI. Somehow I don't see this happening anytime in the near future.

    Mar 30th, 2012 - 12:30 pm - Link - Report abuse 0
  • Alexei

    Whatever, it won't be enough for them. Nothing will ever be enough for them. I can imagine a malvinist in heaven with everything, asking God for some other entitlement he feels he's missing. If any wealth comes from this; it'll probably all end up in the foreign bank accounts of KFC & Co.

    Mar 30th, 2012 - 12:34 pm - Link - Report abuse 0
  • GreekYoghurt

    @4 I'm not convinced that he even read my comment.

    @9 You're right. This isn't shale gas, this is shale oil.

    The fact is, very few companies are capable of retorting oil shale commercially (Shell maybe?) and in the USA the extraction of shale resources has been slow. The technology is certainly not available to the Argentinians. Even with that the economic model of oil shale is adverse because it requires so much processing.

    This news isn't news. Repsol-YPF will not be able to do anything with this find for decades, and that's if they choose to stay in Argentina.

    Mar 30th, 2012 - 12:44 pm - Link - Report abuse 0
  • yankeeboy

    YPF will turn into an arm of the Federal Gov't. They have almost destroyed it anyway so it doesn't really matter. CFK takes her lead from Chavez. PDVSA used to be a strong, technologically advanced company but Chavz looted it to buy food, houses etc for “THE PEOPLE”.
    Now they produce less than they did 20 yrs ago, their equipment is falling apart and all the good engineers went to Canada and Africa. Same thing will happen with YPF as soon as CFK gets her grubby mitts on it.

    Mar 30th, 2012 - 01:45 pm - Link - Report abuse 0
  • GreekYoghurt

    @12 and it costs between U$50 and U$100 to process (mine, retort, upgrade, etc) a barrel of shale oil. How's it going to work out when they're only allowed to charge U$42 or U$62. YPF-Repsol will be making a profit of U$12 per bbl at best estimates. That's considering the £25 Billion in upfront investment you mentioned which of course will be nationalised as soon as it's completed.

    The Spanish should just pack up and leave, there is no good to be found there,

    Mar 30th, 2012 - 01:53 pm - Link - Report abuse 0
  • yankeeboy

    Considering the only recourse a company has when their assets are nationalized is to go to ICSID which Argentina ignores. I doubt very few companies would risk their capital without ARG establishing an US based escrow account beforehand.

    Mar 30th, 2012 - 02:22 pm - Link - Report abuse 0
  • GreekYoghurt

    @14 I concur. However, the likelihood of any of that happening is very very low, especially the escrow account. This is just messaging from YPF-Repsol to say they've found oil. Most Argies will just read that part and then say 'yippee'.

    I'm still laughing at how Argentinians get upset about people actually wanting the money back that Argentina borrowed. They're called 'thieves' or 'pirates' whereas surely it's the Argentinians who are logically in the wrong.

    Argentinian logic is oxymoron.

    Mar 30th, 2012 - 02:47 pm - Link - Report abuse 0
  • yankeeboy

    16. The ICSID judgments are not due to the bonds they're from the pesification of the contracts. So when Arg defaulted on the bonds they also went from 1u$/1 Peso to about 3/1 now its 5/1 (on the way to 14/1) but the contracts were written in U$. K thought that he could just nullify them and move on but ICSID thought otherwise.

    Mar 30th, 2012 - 03:42 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    And Fine wine manufactures are up 38% from 2011 so far, with exports again at a record. In 2010 Mendoza surpassed Chile for the first time, and now is poised to surpass California ex-Napa. A new winery opens every 18 days.

    Last year tourism surpassed 1 million for the first time ever. The province now 4 international ski destinations (Las Lenas, Penitentes, Vallecitos, Los Puques), five new shopping malls making it the center of the region for retail tourism, the world's largest hydro industrial co, the biggest mineral water producer in LatAm, a boombing organic fruit industry, first city with mass transit outside Buenos Aires, city with most suburban motorways/freeways outside Buenos Aires, etc, etc, etc, only province not to default on bonds in 2001.

    And now oil and more oil... Good stuff.

    Mar 30th, 2012 - 04:58 pm - Link - Report abuse 0
  • yankeeboy

    17, That was last year, this year Arg falls out of the US tax preference and has to compete with cheaper wines, some with olive oil. The exporters and producers are already squealing. BTW Brazil is putting a 50% surtax on RG wines too.
    I think your predictions are a bit too rosy with new restrictions don't you?

    Mar 30th, 2012 - 05:02 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    Picture speak 1000 words yankeeboy.

    http://foro.univision.com/t5/Comunidad-de-Futbol/En-10-a%C3%B1os/td-p/434200091#axzz1q3kZWCY6

    http://foro.univision.com/t5/Comunidad-de-Futbol/En-10-a%C3%B1os/td-p/434200091#axzz1q3kZWCY6

    Mendoza has always done better than the rest of the country, it's GDP fell much less in the 2001-2002 depression, and has grown higher than average since. Just facts, doesn't mean we are the next Dubai, just doing fine.

    Between the wine industry, olive oil/garlic, organic fruit, the manufacturing base of metal-mechanics which Mendoza is known for, all the feeder manufacturing business from IMPSA, the tourism (both summer adventure/Aconcagua, fall with the wine season, winter with snow), and the oil, it is a diversified economy in terms of employment.

    There are also a lot of minerals but Mendoza has a very strong environmentalist wing so unlike in provinces north and south of us, they are mainly untapped.

    Mar 30th, 2012 - 05:11 pm - Link - Report abuse 0
  • yankeeboy

    19. I agree Mendoza is nice. I like it there, but I would NEVER live there it is too remote for me but it is a nice place to visit. If you like that sort of rural lifestyle that's great it is just not for everyone. You've got to switch planes 3x to get to somewhere civilized. No thanks!

    Mar 30th, 2012 - 05:39 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    Ha, nice inside joke there yankeeboy. I'll give you props for that.

    Mar 30th, 2012 - 05:51 pm - Link - Report abuse 0
  • GreekYoghurt

    @21 I guess no one told you about the environmental impact of extracting unconventional shale oil. You cannot even grow grass on the cr@p that comes out the arse end of the process.

    Does that upset you?

    Mar 30th, 2012 - 07:11 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    Well, who said the oil would be extracted now or in the next decade? Mendoza still has plenty of conventional oil still pumping out of the ground. Perhaps in the future it will be safer and regardless the wealth is still there so that is what matters in the end. Better than if it didn't exist. It means Mendoza will do well for decades to come.

    Mar 30th, 2012 - 07:59 pm - Link - Report abuse 0
  • GreekYoghurt

    @23 Well you're just sat on a lot of oil and gas that you cannot extract. The Gas Plus price caps make it completely uneconomic to get your it out of the ground and you're all sat there importing LNG from Qatar.

    It's going to be cold in Mendoza this winter.... but not in Maximo hotels!

    Mar 30th, 2012 - 08:35 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    Mendoza is always 23C in winter.

    Mar 30th, 2012 - 08:51 pm - Link - Report abuse 0
  • GreekYoghurt

    ... and drier than a camel's toe. Great for all that water you need for oil extraction.

    Mar 30th, 2012 - 09:23 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    Well, I lied, it does get cold in winter, outside. Inside is 23C I meant.

    Dry is good.

    Mar 30th, 2012 - 10:06 pm - Link - Report abuse 0
  • JuanStanic

    Great place Mendoza. Those guys know how to paint green a desert. Uspallata comes to mind right now. Quite a place.

    Mar 30th, 2012 - 10:18 pm - Link - Report abuse 0
  • MistyThink

    Argentina doesn't need Oil reserves.Look at Venezuela no money going into people's pocket.

    Mar 31st, 2012 - 09:22 am - Link - Report abuse 0
  • GreekYoghurt

    “Argentina doesn't need Oil reserves.Look at Venezuela no money going into people's pocket.”

    That's because both Argentina and Venezuela are corrupt hell holes. Look at Chavez's daughter waving her dollars around on youtube and Maximo waving his new hotels around while Le Camping goose-step past saluting.

    Argentina does need its oil reserves, because it's buying oil from the market at the moment at a mega-risky rate because no one wants to barter with Argentina paying in wine with Argentina's track record of never paying for anything. Because you're buying from the market your country is having to use your pensions and your foreign reserves, which are dwindling fast.

    Sorry about that old chap.

    Mar 31st, 2012 - 10:23 am - Link - Report abuse 0
  • MistyThink

    ( 30)
    Sorry ,
    All oil revenues going into people's pocket from Exxon....BP.....

    Argentina buys oil in return of ..fish exporting not pensions which are not tallied in foreign currency..

    Mar 31st, 2012 - 10:48 am - Link - Report abuse 0
  • Malvinero1

    Sorry ,
    All oil revenues going into people's pocket from Exxon....BP.....
    That is rigth misty.Always was like that,exept with the SOB of mendes.Now the people of Argentina has control over the resources,and the brits do nto like that....After all,what that poor island in the north Atlantic has,excep people?/ Just simple pirates,that do not like to work..

    Mar 31st, 2012 - 12:12 pm - Link - Report abuse 0
  • GeoffWard2

    Malv. etc.

    I remember the phrase 'workshop of the world'.
    Since then, as the brits found that they had too much personal income compared with other nations available for outsourcing, the workshops for British products have been located in cheaper places.

    Oil, gas, intellectual products and financial services have been more recently significantly more important to the brits' GDP.

    Multi-nationalism and globalisation are two worldwide business paradigms that today's Argentina turns away from;
    insularity will not work,
    and the spirals of decline spin much quicker for those who reject the 'real' world.

    Mar 31st, 2012 - 12:43 pm - Link - Report abuse 0
  • GreekYoghurt

    @31,32 The oil revenues aren't going into anyone's pockets because of price capping it's barely worth pulling the stuff out of the ground for U$42 per bbl.

    Shows you how much you le camping gimps know about economics.

    Mar 31st, 2012 - 03:44 pm - Link - Report abuse 0
  • MistyThink

    ( 34 )
    only your chin is ingenious...

    Mar 31st, 2012 - 05:02 pm - Link - Report abuse 0
  • ChrisR

    This whole thread is hilarious.

    Once again we have the Brits and yankeeboy trying to put the truth out there and the Argies still denying reality.

    How I wish the revolution and civil war was coming a little quicker, but coming it is.

    Mar 31st, 2012 - 08:09 pm - Link - Report abuse 0
  • GreekYoghurt

    @35 It's chins, not chin. I'm a right fat porker.

    @36 It'll be here quick enough.

    Mar 31st, 2012 - 08:12 pm - Link - Report abuse 0
  • Truth_Telling_Troll

    @36

    It may get a bit “hot” in Jose Ignacio if Argentina goes into a civil war, dear.

    Mar 31st, 2012 - 08:18 pm - Link - Report abuse 0
  • JuanStanic

    There will be civil war when... when...

    No. It's not going to happen.

    Apr 01st, 2012 - 09:09 pm - Link - Report abuse 0

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