General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThis Dead Cow Has Caught Big Oil's Attention
After lots of speculation, oil and gas giant Chevron (NYSE: CVX ) has finally come to terms on a joint development agreement with Argentine national oil company YPF (NYSE: YPF ) . The $1.24 billion deal will help further the development of oil and gas at Argentina's Vaca Muerta formation. Vaca Muerta, which in Spanish means "dead cow," holds more hope for both Chevron and Argentina than that name might imply, as it's estimated to hold 27 billion barrels of technically recoverable oil.
That's a lot of oil. In fact, it's enough to place Argentina fourth in the world when it comes to recoverable shale oil. If the estimates prove true, it means Vaca Muerta could hold more than three times the amount of recoverable oil as the Bakken, which, according to the U.S. Geological Survey, holds about 7.4 billion recoverable barrels of oil.
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What's interesting here is that the deal announcement comes right after Argentina announced a package of incentives geared toward luring foreign oil and gas investors to the country. The incentives allow companies investing at least $1 billion to eventually be allowed to sell 20% of the oil production abroad without paying export taxes. That would enable the companies to keep the related profits, which enhances the economics for investors.
That bodes well for Chevron, as well as other U.S. oil and gas producers looking to profit from the massive oil and gas reserves in the country -- including EOG Resources (NYSE: EOG ) , which has already signed two exploration contracts and one farm-in agreement with YPF. The company is still in the very early stages of drilling in Vaca Muerta, so it remains to be seen how big its investment in the country will one day become. The company currently spends about $7 billion in capital each year; however, it has a 15-year drilling inventory just in its high-returning, liquids-rich U.S. onshore business. So a billion dollars in Argentina might be a bit of a stretch.
http://www.fool.com/investing/general/2013/07/21/chevron-investing-over-a-billion-dollars-to-bring.aspx
BlueToTheBone
(3,747 posts)the last creature, I wonder how their money will taste. We (the 99%) will all be dead by then.
99Forever
(14,524 posts)May they die a death becoming to the immoral monsters they are.
KoKo
(84,711 posts)You see what I mean.. You have some great posts...but, even here, you have to use "Dead Animal" to throw in when the article could have stood alone...with a less inflamatory title.