Argentina Hands Over Planning Control of Oil to 10 Provinces

Argentina created a commission to oversee oil companies’ business plans that will be controlled by governors of 10 provinces with oil and natural gas resources in a bid to boost efficiency and output.

Oil unions will give advice to the 14-member commission that will also include ministers from Argentina’s labor and planning departments as well as the energy secretary and deputy economy minister, according to the accord signed earlier today between the federal government, the governors and union leaders.

“The state is creating a profitable framework that’s more than acceptable for the industry because we know we need private sector help to produce our natural resources,” Deputy Economy Minister Axel Kicillof said at a press conference in Buenos Aires.

Oil companies will have to submit annual investment plans to the commission that in turn will seek monthly advice from a technical board of provincial governor appointees and appointees by seven oil unions that signed today’s 11-page agreement.

“The commission will monitor oil field activities including labor, production targets, output and investment,” Planning Minister Julio De Vido said at the conference.

The commission will increase monitoring of oil and gas companies, Martin Buzzi, governor of Patagonian province of Chubut said at the same press conference.

“We will monitor every well not just overseeing volume but also the number of drilling rigs, wells drilled and pipelines,” Buzzi said.

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