Neuquén basin operators plan collective spend of $9 billion in 2024

Companies operating in the Vaca Muerta shale formation in the province Neuquén, Argentina, expect to invest US$9.05 billion for operations in the area this year, according to documents presented to authorities in March.

The current investment expectation is a record for the province but could be adjusted during the year. At the beginning of 2023, planned investment totaled $7.6 billion. By yearend, consolidated investments reached just over $8 billion. 

According to current plans reported by the companies, some 427 oil and gas wells are expected to be drilled, 14 more than in 2023. 

YPF leads the companies in terms of investment with plans to spend $4.3 billion, $3 billion of which will be allocated to unconventional resources. The company has initiated a plan to divest mature fields to focus on Vaca Muerta operations. In its fourth-quarter and full year 2023 results, YPF president and chief executive officer, Horacio Marín, said the company aims to increase shale oil production by 24%. The objective, he said, is to increase Vaca Muerta production to 250,000 b/d of oil in 2027 from 97,000 b/d in 2023. If achieved, within 4 years, 80% of the company’s total oil production would be from unconventionals, he said. 

Additional company investment plans include:

• Vista - $903 million. The company aims to increase Vaca Muerta production by 35% to 70,000 boe/d.
• Pan American Energy (PAE) - $848 million. The company will spend $100 million more than in 2023, focused on shale oil production in the Lindero Atravesado, Coirón Amargo Sur Este (CASE), and Aguada Cánepa blocks, as well as shale gas in the Aguada Pichana Oeste and Aguada de Castro blocks.
• Pluspetrol - $861 million. The investment is allocated to the La Calera block.
• Tecpetrol - $480.96 million. The largest gas producer in the basin (Fortín de Piedra block) said spending is down as regional infrastructure limits increased production.
• Shell - $449.98 million. The company expects to continue developing shale oil areas through investment similar to previous years. The aim is to maintain the current production of 30,000-35,000 bbl in operated blocks and 10,000-15,000 bbl in non-operated blocks. The company also plans work on a new early processing plant in the Bajada del Añelo block to process 2 million cu m of gas and 15,000 b/d of oil. A total of 16 wells are expected on production by yearend to supply the new plant and enter the gas market.
• Chevron Argentina - $313.4 million. The company began drilling and connecting the first 2 pads of 4 shale wells in El Trapial block.
• TotalEnergies - $246 million.
• Pampa - $238.80 million. The company aims to maintain its gas production plateau in the Sierra Chata and El Mangrullo blocks while advancing a new gas pipeline to serve Sierra Chata production.
• ExxonMobil - $191.25 million. The company will spend on infrastructure, including the new 43-km Bajo del Choique Nordeste pipeline, allowing transport of up to 60,000 b/d of oil between the crude treatment plant in the Bajo del Choique area and the loading and unloading terminal in Oldelval, in Auca Mahuida. The operator continues to evaluate offers for its seven unconventional blocks in Neuquén basin.