South America: Argentina

SOUTH AMERICA

Stuart Wilkinson, Contributing Editor

Argentina

In mid-2000, the Argentine economy was praised and viewed optimistically. However, by October, neighboring countries were becoming worried. By January 2001, the IMF had approved a $40-billion loan, and Argentina’s debt was put under observation. March saw a difficult, critical period, and by April, shock waves reverberated in the rest of Latin America and other emerging markets. IMF gave further support, and a debt swap improved the situation. In June, a multi-tier exchange rate was adopted, causing alarm to foreign investors, but IMF supported the move.

Exploration. Late last year, Wintershall acquired 35% of the Tauro-Sirius and Octans-Pegaso offshore concessions from Total Austral SA. The concessions are located in the Austral basin of Tierra del Fuego and have proven, but undeveloped, gas reserves of 750 Bcf. Wintershall was already producing 113 MMcfgd in the neighboring concession of Cuenca Marina Austral.

Noble Affiliates’ subsidiary, EDC Argentina, Inc., received government approval for a 1.2-million-acre oil and gas exploration permit, CcyB-17/A, called Mendoza Norte. The firm also bid successfully on CcyB-17/B. Both permits are located in the Cuyo basin of Mendoza Province.

Pioneer Natural Resources SA completed testing of its BBG-21 well in Bajo Barda González field, in the Neuquen basin. The well flowed 785 bopd and 15.7 MMcfgd from a depth of 5,100 ft. Pioneer owns a 100% interest in this field.

Pan American Energy’s Acambuco gas field onshore Argentina is the company’s third-largest asset in the country after Cuenca Marina Austral and Cerro Dragón. Exploration activity in the concession will remain strong through the end of 2001, and the joint venture with four partners plans to invest in excess of $100 million during 2001. (Photo courtesy of British Petroleum)

Drilling / development. Wintershall plans to invest some $200 million in the Tierra del Fuego region in the next five years, to develop its newly acquired reserves. The company also holds a 10% stake in the $170-million, 70-MMcfgd Cruz del Sur pipeline, which will link Argentina and Uruguay when completed by year-end. The other stakeholders are BG (40%), BP-controlled Pan American Energy (30%) and Uruguay’s ANCAP (20%).

To develop its Bajo Barda González discovery, Pioneer expects to drill 82 wells, concentrating primarily on oil production. Meanwhile, Vintage Petroleum closed the purchase of two Cuyo basin concessions covering 104,000 acres. The company purchased all of Pérez Companc’s (now called Pecom Energía SA) interest in Cuyo for $39.6 million. The properties produce 32°API sweet crude.

Last year, 1,053 wells were drilled in Argentina, nearly double the number drilled in 1999; 873 were oil wells and 94 were gas wells.

Production. In 2000, there were 13,955 wells producing; of these, 416 flowed naturally and 13,539 were on artificial lift. Producing gas wells numbered 860. Crude production averaged 770,533 bpd, while gas production averaged 4.35 Bcfd.