Among the number one in the oil sector, everyone recognizes that Vaca Muerta's resources are viable, competitive and abundant. Another “Argentine field” in terms of foreign exchange and with the possibility of being a greater generator of employment. With these words, the CEOs of the main companies stood out in the framework of the XIII Argentina Oil & Gas, the fair that brings together the leaders of the sector.
However, in the context of rising international prices and geopolitical changes in demand and supply of gas and oil due to the war in Ukraine, they also warned about the bottleneck in infrastructure works that would allow the country to export its resources to various markets around the world.
However, the vision for the future was optimistic. At one of the conferences, YPF CEO Sergio Affronti, listed the company's achievements in production growth in 2021 and its expectations for the future. In gas, for example, production of non-conventional doubled, from 10 million cubic meters to 20 million cubic meters. And in oil production of non-conventionals grew by 60%. “We continue to apply technology to reduce costs and times with more productivity in wells,” he said. He also detailed the increase in the company's proven reserves and the reduction of its financial debt.
In 2022, YPF plans to invest USD 3.7 billion, of which $1.6 billion is for the non-conventional segment. But also investments in downstream (refineries and fuel sales) and conventional oil and gas drilling. The goal in five years is to double current oil production.
“Vaca Muerta is our most important solution. But we have to create the conditions. Productivity is there, resources are there. Situations have to be unlocked, investments are a big challenge as a country and they have to be a binding idea because they have benefits for all actors,” he said in the talk. The target? Be a net energy exporting country.
Javier Martínez Alvarez, president for the Southern Cone of Tenaris, said that in the face of a painful war situation such as the war in Ukraine, Europe is beginning to reflect on its energy supply and talk about energy security. “Latin America has no hypothesis of war conflicts. If Argentina has clear long-term rules, it can accompany this challenge. The United States also plays a very important role,” said the company's manager.
“We must unlock the construction of oil and gas pipelines. Vaca Muerta may be the gas hub of South America,” he added.
Meanwhile, Ricardo Markous, CEO of Tecpetrol, the oil company of Techint Group, stressed that Vaca Muerta has resources for 100 years and set a path of priorities for the industry. Firstly, export to Latin America with the structure already established and with more integration with Brazil. Then, think about exporting Liquefied Natural Gas (LNG) taking into account experiences such as that of Peru, for example, that demand millions of dollars of investment. “Argentina has a responsibility to develop its resources. Energy is a generator of foreign exchange and employment,” he said.
Managers agreed that the gas pipeline (the Néstor Kirchner project that is in the bidding stage) is the immediate big challenge. “Vaca Muerta's production is viable, competitive and abundant. There are infrastructure bottlenecks,” said Martínez Alvarez.
For his part, Osvaldo del Campo, from Galileo, a provider of infrastructure for the industry, proposed to compete in the export of gas in the regional market, with destinations such as Brazil. “Over time, the conditions will be aligned to develop our own export model that caters to the region, which is very attractive. Thinking about China requires very hard investments, and all at the same time,” he said.
Javier Gremes, from Pecom, highlighted the goal of 1,000 wells per year in Vaca Muerta, but indicated that conditions need to be in place for SMEs to access credit to invest in training and infrastructure, and import raw materials in order to meet this challenge. “Currency is going to be generated above what is imported,” he said.
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