ExxonMobil is reviewing its oil and gas operations and interests in seven unconventional areas in Argentina’s Neuquén basin, according to Enverus.
Officially, ExxonMobil Exploration Argentina (EMEA) is seeking farm-in investors, but asset sales were not ruled out, an ExxonMobil source told OGJ. "It is still premature to determine the final outcome of the ongoing review process, which runs parallel to our development commitments in the basin. It may not necessarily result in asset divestment," according to the source.
According to the Enverus report, unofficial industry sources “indicated in mid-July 2023 that ExxonMobil's local subsidiary [EMEA] was considering divesting its assets in the Vaca Muerta shale in the Neuquén basin, after years of exploration and pilot programs in the area."
The areas under review are as follows:
- Bajo del Choique - Lea Invernada (402 sq km) - ExxonMobil (operator, 90%), Gas y Petróleo del Neuquén (10%).
- Loma del Molle (179 sq km) - ExxonMobil (operator, 50%), YPF (50%).
- Los Toldos II Oeste (78 sq km) - ExxonMobil (operator, 90%), Gas y Petróleo del Neuquén (10%).
- Los Toldos I Sur (195 sq km) - ExxonMobil (operator, 80%), Tecpetrol (10%), Gas y Petróleo del Neuquén (10%).
- Pampa de las Yeguas I (59 sq km) - ExxonMobil (operator, 50%), YPF (50%).
- Parva Negra Este (285 sq km) - Pampa Energía (operator, 42.5%), ExxonMobil (42.5%), Gas y Petróleo del Neuquén (15%).
- Sierra Chata (866 sq km) - Pampa Energía (operator, 54.45%), ExxonMobil (45.55%)
Evaluation of the assets in Argentina is part of the normal processes carried out by the corporation globally and has been initiated to enhance their development, the official said. While reiterating that it is too soon to anticipate possible outcomes, the source said the decision will likely come before yearend adding, without specific detail, that the company is considering proposals.
Meanwhile, development work continues. Construction on a 60,000 b/d pipeline is expected to begin in 2024. Other work includes connection of a 6-well pad in Bajo del Choique, and drilling of the first two wells in the Los Toldos 2 Oeste area as part of a pilot project that is expected to begin in the coming weeks.
To date, ExxonMobil has drilled about 40 wells in Neuquén basin, although only seven are in production. The rest are drilled and uncompleted (DUC). In May 2023, ExxonMobil produced an average of 7,300 b/d of crude oil and 103 Mcfd of shale gas from the basin.
ExxonMobil also has an offshore exploration program in several blocks in the West Malvinas basin (MLO 117, MLO 113, MLO 118) off Argentina’s southern coast in partnership with Qatar Petroleum.
According to the Enverus report, Argentina's economic situation could be the reason ExxonMobil has yet to further advance its Vaca Muerta assets. However, the EMEA official told OGJ that the review process “is not related to any political circumstances or events.”
Camilo Ciruzzi | South America Correspondent
Ciruzzi is a journalist based in the Argentine province of Río Negro. He has over 30 years of experience in radio and print media. Ciruzzi studied Communication Sciences at the University of Buenos Aires and specialized in energy, political economy, and finance.