Repsol YPF SA (REP) sees “colossal” potential for producing oil and natural gas from unconventional fields in Argentina, where it’s exploring for resources, Chief Executive Officer Antonio Brufau Niubo said.
“What is very clear is that there’s a new frontier” for oil production, Brufau told reporters today in Doha, Qatar. “There’s a new place that will deliver a lot of long-term production of hydrocarbons.” The company expects to spend “about $30” for each barrel of oil it develops in an initial segment of the deposit it’s exploring there, he said.
Repsol, Spain’s biggest oil company, is exploring in the Vaca Muerta shale site in Argentina, the largest discovery in the company’s history. The first section of the reservoir the company has tested contains 927 million barrels of recoverable resources of oil equivalent and non-conventional hydrocarbons, Brufau said at the World Petroleum Congress in Qatar’s capital.
International oil companies are seeking oil and gas resources that are buried tight within rock formations or deep undersea and are accessible only with new technology as they aim to meet growing demand and offset declines in older fields.
Repsol is only working in about 1,000 of the 30,000 square kilometers (11,600 square miles) that the Vaca Muerte deposit covers so it’s too early to know the total production potential for the fields, Brufau said. The company’s allotted segment of Vaca Muerta is 12,000 square kilometers.
The company has explored an initial area of 400 square kilometers and is now testing a second area of 500 square kilometers, Brufau said.
“We need a lot of money” to develop the first section, he said. “Let’s assume that to produce 1 barrel it will cost around $30 of finding and development” and operating expenses to pump the more than 900 million barrels of oil potential there, he said.
To contact the reporters on this story: Anthony DiPaola in Doha at firstname.lastname@example.org.