27 apr: PRECIOUS METALS HIGHLIGHTS: Top Stories Of The Day
27 apr: Speculators Slightly Less Optimistic About The Dollar: CFTC
27-04-2012 22:12:00

UPDATE: Argentina's YPF Move Risks Deterring Oil Investment

Relateret indhold
03 apr - 
Verdens største virksomhed

--YPF expropriation raises concerns about Argentina's energy policies

--Investment key to developing unconventional oil and gas

--Some oil companies upbeat about the country

(Adds comment from Petrobras and other details in paragraphs seven and 13.)

By Taos Turner

Of DOW JONES NEWSWIRES

BUENOS AIRES -(Dow Jones)- President Cristina Kirchner's nationalization of oil company YPF SA (YPF, YPFD.BA) has exacerbated concerns about Argentina's energy industry and its ability to develop vast unconventional oil and gas deposits.

Exploiting those resources will require billions of dollars a year in foreign capital, and Kirchner's no-holds-barred expropriation of a 51% stake in YPF from Spain's Repsol YPF SA (REP.MC) could jeopardize those investments.

Deputy Economy Minister Axel Kicillof, the intellectual architect behind the YPF nationalization, hinted last week in congressional testimony that Repsol might not get any financial restitution once YPF's alleged liabilities are considered, and derided Repsol's demand for $10 billion in compensation.

Nomura Securities strategist Boris Segura said Argentina is sending "a very bad message regarding the rule of law and the sanctity of contracts. This is going to deter foreign direct investment in the energy sector, where Argentina has huge potential."

That investment is crucial to Argentina's future. Argentina ranked third in the world, behind China and the U.S., in potentially recoverable shale-gas reserves, with 774 trillion cubic feet, according to a study last year by the U.S. Energy Information Administration.

In February, YPF said it would require $25 billion a year for a decade to put its estimated 23 billion barrels of shale oil and gas resources into production, a bill that no single company, let alone Argentina's cash-strapped government, can afford to pay.

The nationalization of oil companies hasn't always deterred producers from investing in risky parts of the world, as was seen in Venezuela when Chinese, Indian and Russian oil companies invested there after President Hugo Chavez expropriated assets from ConocoPhillips (COP) and Exxon Mobil Corp. (XOM). But their presence hasn't added much to Venezuela's output in recent years, and the country's production level remains roughly what it was when Chavez ramped up his nationalization drive half a dozen years ago.

Nonetheless, Venezuela is still a major oil exporter, while Argentina's priority is to provide cheap energy to its domestic market.

To drum up investment, Kicillof and Planning Minister Julio de Vido have met recently with executives from Exxon Mobil, Chevron Corp. (CVX), ConocoPhillips, France's Total SA (TOT, FP.FR), Brazil's Petroleo Brasileiro SA (PBR), and Apache Corp. (APA).

The expropriation has left executives at several oil companies thinking twice before committing more money to Argentina, while others plan to tread cautiously.

Exxon Mobil spokesman Patrick McGinn said the company is prepared to make the necessary investments in Argentina to expand oil and gas production if its exploration efforts for unconventional resources in Neuquen Province are successful.

"However, given the long-term nature of our business, our investment must be supported with fiscal terms and product pricing that provides a return commensurate with the risk we are undertaking and must be underpinned by stable fiscal and regulatory policy," he said in an email.

Brazil's Petrobras said it would invest $500 million in Argentina this year, in line with previous years. The other companies either couldn't be reached or declined to comment specifically about their meetings with the government.

Government critics have said onerous price caps and unpredictable policies--such as the recent suspension of tax breaks for drilling--have discouraged investment in the sector.

While local natural-gas producers can charge only $2 to $3 per million British thermal units, the government pays around $16 per MMBtu for imported liquefied natural gas, or LNG.

Such policies have led to declining production and reserves, turning Argentina into a net energy importer for the first time in 17 years. This year, Argentina's energy deficit is set to more than double to $7 billion.

Even if investment pours in and the government manages YPF well, these problems are "irreversible in the short and medium term," said the Argentine Energy Institute. The institute described YPF's expropriation as "confiscatory" and said it will likely spur lawsuits and "discredit Argentina internationally."

Some oil companies are more sanguine.

Barclay Hambrook, president of Americas Petrogas Inc., a junior Canadian exploration company operating in Neuquen, said in a phone interview that his company is moving "full-steam ahead."

The company and its joint-venture partners plan to drill 30 conventional wells and 10 shale wells mainly in the Vaca Muerta formation, home to massive shale oil and gas resources.

Paal Kibsgaard, chief executive of oil services giant Schlumberger Ltd. (SLB), which moved "a fair bit" of capacity into Argentina in the last 12 months, is upbeat.

"We are still quite positive on the medium to long term on Argentina, and I think that whatever way they are going to develop these resources--and they will--there is going to be a strong need for our expertise and our products and services there," he said during a conference call last week.

-By Taos Turner, Dow Jones Newswires; 5411-4103-6728; taos.turner@dowjones.com

--Ken Parks contributed to this article.

(END) Dow Jones Newswires

April 27, 2012 16:12 ET (20:12 GMT)

Copyright (c) 2012 Dow Jones & Company, Inc.

Opret kommentar

Relateret debat

  • 1 uge
  • 1 måned
  • 1 År
Ingen indlæg

Fondsbørsmeddelelser

Maersk Line-chef tager på charmeoffensiv i Kina

19-09-2014 15:47:03
Den administrerende direktør for Maersk Line, Søren Skou, har besøgt de kinesiske myndigheder i et forsøg på at skaffe opbakning til en ny shipping-alliance med..

Novo/Sydbank: Novo sidder tungt på diabetes-tronen

19-09-2014 12:17:21
Sydbank fastholder sin anbefaling af Novo Nordisk-aktien til trods for, at den amerikanske lægemiddelstyrelse, FDA, torsdag aften har godkendt Novo-konkurrenten..

Novo: Nygodkendt diabetesmiddel giver lynhurtigt effekt

19-09-2014 11:31:02
Novo Nordisks nye kombinationspræparat til behandling af type 2 diabetes, Xultophy, yder allerede efter fire uger en betydelig blodsukkerkontrol.Det fremgår af ..

Mest læste nyheder

  • 24 timer
  • 48 timer
  • 1 uge
1
Vestas/Jyske: Svagt momentum bag lavere kursmål
2
Aktier/åbning: C20 styrer mod rekord efter skotsk afstemning
3
Novo får godkendt kombinationsmidlet Ideglira i EU
4
Aktier/tendens: Skotsk afstemning løfter stemningen
5
Aktier/middag: Skotterne sender Vestas og C20 til vejrs

Relaterede aktiekurser

Petroleo Brasileiro S.A. 16,78 -1,8% Fald i aktiekurs
Exxon Mobil Corp 97,12 0,5% Stigning i aktiekurs
Chevron Corporation 124,80 0,5% Stigning i aktiekurs
Total 50,04 0,1% Stigning i aktiekurs
ConocoPhillips 80,56 0,7% Stigning i aktiekurs
Apache Corp 96,51 -0,5% Fald i aktiekurs
YPF SA 36,51 -0,1% Fald i aktiekurs
Total S.A. 63,57 -0,8% Fald i aktiekurs
Schlumberger Ltd 103,21 -1,2% Fald i aktiekurs
Total S.A. Total ORD SHS 50,10 0,5% Stigning i aktiekurs
Schlumberger 81,02 -0,2% Fald i aktiekurs
Schlumberger 97,00 0,0% Aktiekurs uændret
Chevron 122,50 0,9% Stigning i aktiekurs
Schlumberger COM STK US$.. 103,15 0,0% Aktiekurs uændret
Euroinvestor i andre lande: Euroinvestor.com | Euroinvestor.se | Euroinvestor.no | Euroinvestor.fr | Forexinvestor.com| Wisselkoersen.nl | Valuta.se | Valutaveksel.no | Divisas.es | Valute.it
Copyright Euroinvestor A/S 2014  Disclaimer Privatlivspolitik
Aktieinformation leveres af Interactive Data.
Data er forsinket 15-20 minutter iht. de enkelte børsers regler om videredistribution.
 
20. september 2014 03:55:47
(UTC+01:00) Brussels, Copenhagen, Madrid, Paris
Version: LiveBranchBuild_20140919.1 - EUROWEB3 - 2014-09-20 03:55:47 - 2014-09-20 03:55:47 - 1 - Website: OKAY

Når du besøger Euroinvestor.dk accepterer du, at der anvendes cookies, som vi og vores samarbejdspartnere benytter til funktionalitet, statistik og markedsføring. Læs mere om cookies på Euroinvestor.dk her

x