By Dow Jones Business News,
February 18, 2014, 12:07:00 PM EDT
By Shane Romig
BUENOS AIRES--Argentine oil company YPF SA has signed a letter of intent with a subsidiary of Malaysia state energy
company Petroliam Nasional Bhd to work toward an investment and exploration agreement in Argentina's vast Vaca Muerta
shale oil and gas fields, YPF said Tuesday.
No financial details were provided. YPF and Petronas plan to negotiate development of a 187-square-kilometer area of
the Vaca Muerta formation known as La Amarga Chica, YPF said.
The deal comes a week after YPF said it had agreed to pay $852 million for all of Apache Corp's. oil and gas
operations in the South American country, as part of an effort by the state-owned company to increase gas output.
Argentina ranks second in the world, behind China, in potentially recoverable shale-gas reserves, with 802 trillion
cubic feet, according to a study last year by the U.S. Energy Information Administration. Argentina also ranks fourth in
shale oil with an estimated 27 billion barrels.
YPF's oil and gas concessions cover about 40% of Vaca Muerta, which spreads across the provinces of Neuquen and
Mendoza in southern Argentina. Chevron Corp. has agreed to fund most of a $1.5 billion joint venture with YPF to develop
YPF is currently involved in talks with Argentina's government and the Spanish energy company Repsol to compensate
Repsol for the expropriation of its majority stake in YPF in 2012. The parties reached a preliminary deal in November in
which Argentina agreed to pay Repsol$5 billion in government bonds.
Write to Shane Romig at firstname.lastname@example.org
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