Bloomberg News

Chevron, YPF Meet in Houston to Advance Argentina Shale

November 19, 2012

YPF SA (YPFD) and Chevron Corp. (CVX:US) officials will attempt to move forward this week on a proposal to jointly develop deposits at the world’s third-largest reserves of shale oil and gas, a YPF document obtained by Bloomberg News shows.

Technical teams will convene in Houston two months after the San Ramon, California-based company signed a memorandum of understanding to study the recovery of oil from aging wells through new technologies and partnerships to tap the Vaca Muerta shale formation, according to the internal document.

James Craig, a spokesman for Chevron’s African and Latin American operations, declined to comment on any commercial negotiations. Alejandro Di Lazzaro, YPF spokesman, also declined to comment in an e-mailed response to questions.

Vaca Muerta is a Connecticut-size area in that contains at least 23 billion barrels of oil. YPF, which the government expropriated from Spain’s Repsol SA in April, is seeking a shale partner to invest $4.5 billion as part of a $37.2 billion five- year expansion, according to the document.

Argentina wants Chevron to step up investments as the U.S. company battles a court embargo on its existing assets in the country. On Nov. 7, Civil Judge Adrian Elcuj Miranda ordered 40 percent of Chevron’s Argentine bank accounts to be held in escrow after receiving a petition from Ecuadorean plaintiffs seeking to enforce a $19 billion award in that country.

In a separate case, a Spanish mercantile court agreed to consider a suit filed by Repsol against Chevron over oil and gas operations in Argentina, Kristian Rix, a spokesman for the Madrid-based company, said by telephone

Chevron’s Craig declined to comment on Repsol’s demands.

To contact the reporter on this story: Pablo Gonzalez in Buenos Aires at

To contact the editor responsible for this story: James Attwood at

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