Page 14 - LatAmOil Week 12 2020

LatAmOil ARGENTINA LatAmOil
 YPF drives production in Vaca Muerta, one of the largest shale formations in the world.
About the size of Belgium, Vaca Muerta con- tains around 308tn cubic feet (8.722tn cubic metres) of shale gas, according to the US Energy Information Administration (EIA). Royal Dutch Shell, Total, ExxonMobil, Chevron and a subsidiary of BP are among the companies with a stake in the formation, which lies in Neuquén Province in central Argentina.
As of March 22, Argentina had 225 con- firmed cases of coronavirus and four deaths, according to local reports. Alberto Fernandez,
the country’s president, ordered a mandatory quarantine on March 19, meaning that people can only leave their homes for essential goods such as food and medicine. The country has already suspended flights from highly affected countries for a month and closed its borders to non-residents for 15 days, to combat the spread of the pandemic.
“It is time for us to understand that we are caring for the health of Argentines. We have now dictated this measure trying to make the effects on the economy as least harmful as possible,” Fernandez was quoted as saying by Reuters.™
Quarantine hits Argentina’s fuel consumption, gas production
ARGENTINA’S oil and gas industry is already feeling the impact of the wide-ranging quar- antine measures that the government imposed last week, according to the national oil company (NOC) YPF.
In a video obtained on March 24 by La Nacion, YPF’s executive president Daniel Gon- zalez said the effects of the quarantine were evi- dent in the downstream sector. “The demand for gasoline is 70% below that of the previous days, diesel is closer to 50% and aviation fuel is down about 90%,” he said, according to the newspaper.
Gonzalez further noted that demand was down for all types of fuel. This has affected upstream production operations at natural gas fields, he said. With consumption levels sinking, he explained, gas output is “between 15% and 20% below what it was in previous days.”
Argentina’s oilfields have remained online, but YPF has reined in its drilling programmes, he added. “Oil production is practically unaf- fected,” he said, according to La Nacion. “We have stopped drilling and completing wells. We are wrapping up, leaving the last new wells and equipment in a safe condition.”
He also thanked YPF’s workers for their con- tributions but warned that the company was facing “difficult times”, not least because of the dive in world oil and gas prices. “This will leave us with the need to export crude oil at low prices, with which our income will clearly be negatively affected,” he said.
YPF has more or less confirmed Gonzalez’s statements. It acknowledged the veracity of the video, saying that it had indeed been produced within the company, but stressed that it had been intended for internal use.
Argentina’s government put a nationwide mandatory quarantine in place on March 19 in a bid to slow the spread of the coronavirus (COVID-19). It intends to keep these measures, which are among the strictest in Latin America, in place until at least March 31.
The quarantine is likely to strain Argentina’s economy, which was already suffering amidst a recession and high inflation rates. President Alberto Fernandez has said that the government will not be able to start paying down a loan from the International Monetary Fund (IMF) for at least another five years. ™
Argentina’s drivers are using less gasoline (Photo: Latin American Post)
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w w w . N E W S B A S E . c o m Week 12 26•March•2020