Argentina’s second largest shale producer to invest $1 billion in Vaca Muerta

Independent producer Vista Energy, Argentina’s second-largest shale producer, plans to invest about $1.1 billion in the growing Vaca Muerta shale basin, the company’s founder and CEO Miguel Galuccio told Reuters in a interview published on Wednesday.

Argentina’s Vaca Muerta shale area is the top development priority for the company, which also operates an onshore oil and gas field in Mexico.

Vaca Muerta—Spanish for “dead cow”—was nicknamed Argentinian Permianalthough its geological properties have been more aptly compared to the Eagle Ford.

The Vaca Muerta shale area is estimated to hold recoverable resources consisting of 16 billion barrels of oil and 308 trillion cubic meters of natural gas. These figures make Vaca Muerta the second largest shale gas field in the world.

In addition to the $1 billion investment in the basin, Vista Energy also aims to achieve double-digit cost reductions and increase efficiency, Galuccio told Reuters.

“In 2012 Vaca Muerta was for the faithful. Today Vaca Muerta is for engineers,” the executive said, referring to the production gains operators can get from the shale play.

Vista Energy has up to 1,150 locations under development in Vaca Muerta, including 124 wells already drilled. Total production was 65,300 barrels of oil equivalent per day (boepd) in the second quarter of 2024, according to the company’s website.

Vista Energy, which is listed in New York and Mexico, also boasts that the productivity of its shale oil wells is among the best in the basin.

Argentina plans to increase oil and gas production and exports from Vaca Muerta in the coming years.

Supertankers could begin docking in Argentina to load oil from the country’s shale after a pipeline connects Vaca Muerta with a terminal in the port of Punta Colorada capable of handling so-called very large crude carriers (VLCCs).

Argentina is also moving closer to exporting LNG and monetizing its huge Vaca Muerta resource after LNG marine infrastructure firm Golar LNG signed a 20-year deal with Pan American Energy (PAE) to deploy a liquefied natural gas floating (FLNG). ) ship to Argentina.

By Tsvetana Paraskova for Oilprice.com

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