Shale Pioneer McClendon Joins YPF in $500 Million Argentina Dealby and
McClendon's new shale company to help drill Vaca Muerta
Ex-Chesapeake boss lends drilling expertise, YPF CEO says
The companies will invest more than $447 million during an initial three-year phase to develop a pilot project in a 200 square-kilometer (123 square-mile) area called Bajada de Anelo in Neuquen, home to the world’s second-largest shale-gas deposit, the Buenos Aires-based company said. The companies will also join Pluspetrol SA and Gas y Petroleo del Neuquen SA in developing a smaller area known as Cerro Arena; American Energy will invest $60 million in the block.
McClendon’s arrival may spur more foreign investment in a shale region that has already attracted international giants such as Exxon Mobil Corp. and Chevron Corp. During his quarter century at the helm of Chesapeake Energy Corp., the 56-year-old McClendon embraced drilling and fracking innovations that unleashed the shale revolution ignored by the world’s biggest energy producers, building the company into what was for a time the largest U.S. source of gas.
“We’re adding a partner that will bring high level expertise to develop gas and oil shale and we believe our learning curve will be boosted,” YPF Chief Executive Officer Miguel Galuccio said in an e-mailed statement.
American Energy, formed by McClendon after he was forced out of Chesapeake by a shareholder revolt in 2013, will become YPF’s fourth-largest shale partner in Vaca Muerta after Chevron, Dow Chemical Corp. and Petroliam Nasional Bhd. Chevron was first to join YPF to tap the world’s fourth-largest shale oil reservoir in southwestern Argentina, with the two companies pledging to invest about $15 billion over 35 years.
“The execution of the projects will begin once definitive agreements have been signed and certain conditions precedent have been met,” according to a YPF regulatory filing.
McClendon said in the statement that he hopes to apply technical skills for drilling and cost structures from his experience with shale in the U.S. to help develop Vaca Muerta.