Argentina's YPF agreed on Wednesday to pay 852 million dollars for all of Apache operations and assets in the country, making the government managed company the largest operator of natural gas.
Likewise YPF announced it had sold Pluspetrol exploration and production rights over 1.240 square kilometers at the Vaca Muerte shale deposits area for 217 million dollars.
Under contract terms, YPF makes a down payment of 50 million dollars and the rest is delivered in 30 days. Houston based Apache Corporation has interests in the provinces of Neuquen, Rio Negro and Tierra del Fuego, which as of now come under YPF.
This is an excellent opportunity to add to YPF assets an active operation with significant reserves of conventional gas and non conventional resources, said Miguel Galuccio, the company's CEO in a release.
Apache has a daily production of 46.800boe and proven reserves of 135 million boe, a staff of 350 and an important infrastructure. For YPF this means a 14% increase of its hydrocarbons reserves and a 15% increase in natural gas production. Particularly interesting is the Medanito light oil, excellent for refineries, and the fact that YPF can now return to the Austral basin
We plan to immediately increase gas production by drilling more wells, and at the same time work in coordination with national and provincial authorities to ensure the sustainable development of regional economies, said Galuccio.
The other YPF operation with Pluspetrol is the result of acquiring the Apache assets, some of which are linked to the Argentine private company. Under the agreement with Pluspetrol, YPF sells exploration and production rights over 1.240 square kilometers in the Vaca Muerta area for the price of 217 million dollars.
We are very pleased to become partners with a company like Pluspetrol which is highly professional and which was the only company that together with YPF reversed the decline of oil and gas output in 2013, underlined Galuccio.
YPF already has 12.000 square kilometers in the Vaca Muerta region with over 100 wells drilled, 19 drilling teams in the area and a daily production of 13.000boe of oil and gas. The nationalized company is also the main producer of oil and gas in Argentina with over 35% of the market for both items
Pluspetrol is an Argentine company which was started over thirty years ago in Centenario, Neuquén and currently also operates in Chile, Peru, Colombia, Bolivia, Venezuela and Angola.
Apache has been selling assets around the world to improve its balance sheet after years of aggressive acquisitions. Last year, the Houston-based company said it planned to raise around 4 billion dollars through asset sales.
In a statement, Apache said it has brought in more than 7 billion from assets sales over the past two quarters and is using that money for investment, debt reduction and stock buybacks, among other things.