BASF’s Wintershall Selling Stake in Argentine Shale Block

BASF SE’s Wintershall, Germany’s largest oil producer, is seeking partners to develop a shale-rock deposit in Argentina after the country increased prices for natural gas.

The company, based in Kassel, Germany, plans to sell a stake in its CN-V block in Neuquen province to divide investment costs, Jurgen Schuster, vice-president for ventures, said in an interview in Bogota today, declining to name potential buyers. It also expects to start production at the country’s Vega Pleyade offshore field, which it owns in a partnership with Total SA and Pan American Energy LLC, around 2016.

Argentina, which holds the world’s third-largest shale-gas reserves, is luring investment plans from foreign producers including Total, Exxon Mobil Corp. and Royal Dutch Shell Plc. The South American country almost doubled gas prices at the well to $7.50 per million British thermal units in November to encourage investment.

“Argentina will remain our regional priority and recent news from the government is heading in the right direction,” Schuster said.

Wintershall hasn’t drilled the CN-V block yet and doesn’t know whether it contains gas or oil, he said.

While Argentina is Wintershall’s priority in Latin America, the company is also interested in the possibility of expanding in neighboring Brazil, where the government will hold auctions for oil and gas concessions three times this year, Schuster said.

Wintershall is the fourth biggest gas producer in Argentina, according to its website.