YPF Tracks ADR Drop on Government Intevervention Concern

YPF SA (YPFD), Argentina’s largest oil producer, fell the most in a month in Buenos Aires trading after Chubut province said it plans to revoke the company’s most productive field.

The stock retreated 15 percent to 124.95 pesos at 11:48 a.m. in Buenos Aires, the biggest intraday decline since July 2, 2009. YPF’s American depositary receipts dropped as much as 16 percent yesterday when Argentine markets were closed.

YPF has lost 12 licenses to operate oil fields in five Argentine provinces since March 14 after President Cristina Fernandez de Kirchner’s government demanded higher investment to curb output declines and halt growing imports. The Manantiales Behr field, which produced about 10 percent of Buenos Aires- based YPF’s oil last year, is among four more licenses the Patagonia province of Chubut plans to revoke.

“The sentiment is clearly moving toward stronger government intervention in YPF,” Walter Chiarvesio, a Buenos Aires-based analyst at Banco Santander SA, wrote in a research note today.

Kirchner may send a bill to congress this week proposing the government acquire a stake in YPF, Chiarvesio wrote. Argentina’s Congress may take up legislation on YPF in coming days, Buenos Aires newspaper La Nacion said, citing sources in the legislature it didn’t identify.

YPF’s workers would reject the nationalization of the company because the government doesn’t have the money to invest in new fields, newspaper La Prensa de Neuquen said, citing union leader Guillermo Pereyra.

To contact the reporters on this story: Eduardo Thomson in Santiago at ethomson1@bloomberg.net; Matthew Craze in Santiago at mcraze@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

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