Page 16 - LatAmOil Week 19 2020
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Both fields are in the shallow-water section of the Santos Basin, the largest offshore sedimen- tary basin in Brazil.
Last year, Merluza and Lagosta yielded 3,600 barrels of oil equivalent per day (boepd), accord- ing to Petrobras, which is the sole concessionaire
for both fields.
By contrast, the four Marlim fields yielded
around 243,000 boepd in March, equivalent to about 10% of Petrobras’ total output. As such, this cluster would represent a much bigger sale than previous recent divestments.
Argentina’s plan for domestic reference price gains momentum
ARGENTINA
THE government of Argentina’s proposal to set a minimum reference price of $45 per barrel of oil in an effort to save the domestic hydrocarbon sector appears to be gaining momentum.
The administration of President Alberto Fernandez has reportedly circulated the pro- posal for setting a price by executive decree in response to the global slide in oil demand that has been triggered by the coronavirus (COVID- 19) pandemic. The move has been welcomed by many local industry players, who believe the government’s proposed intervention could lead to real progress.
“If we don’t do it, the big danger is that when things get back to normal, perhaps in a year, and prices rebound, we don’t have production going andwehavetoimportcrude,”ProductionMin- ister Matias Kulfas said during a radio interview last week.
“This is an opportunity moment,” David Tawil, interim chief executive officer of inde- pendent producer Centaurus Energy, told Bloomberg. “Argentina shouldn’t squander the progress made in Vaca Muerta. This is a time when the government can make strides,” he added, referring to efforts to develop the massive shale formation in Neuquen Province.
Others observers warned of the dangers if no action is taken to control oil prices. “Argen- tina needs to have a long-term vision [for] Vaca Muerta, because right now it could go either way,” Miguel Galuccio, the founder of Vista Oil & Gas, told Bloomberg.
Galuccio also called the minimum reference price “the way to keep all companies alive.” Tak- ing this step will allow the government “to make sure we get past all the wild animals in our path and come through the other side,” he added.
The Fernandez administration recently began considering the new pricing policy in the hope of helping domestic producers keep
pumping oil despite the abrupt fall in world crude prices. It was particularly keen to prevent a slowdown at fields in the Vaca Muerta forma- tion, which holds enough oil and natural gas to help Argentina become a net exporter.
The government has been concerned by reports that Argentina’s state-run energy firm YPF reduced oil output at Vaca Muerta fields last month, citing the fact that domestic fuel demand has fallen because of the pandemic. The national oil company (NOC) closed down half of its producing wells at Loma Campana, its flagship field at Vaca Muerta, according to Rio Negro, a local newspaper.
YPF is working with the US major Chevron to develop Loma Campana, which is already capableofyieldingmorethan40,000barrelsper day (bpd) of oil. Royal Dutch Shell (UK/Neth- erlands), Total (France), ExxonMobil (US) and a subsidiary of BP (UK) are among the other international oil companies (IOCs) investing in Vaca Muerta, which is one of the largest shale formations in the world.
Vaca Muerta projects could make Argentina a net energy exporter (Photo: YPF)
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w w w . N E W S B A S E . c o m Week 19 14•May•2020
