Vaca Muerta shale

Production from the Vaca Muerta now accounts for 23% of Argentina’s natural gas output. With only 4% of the shale play’s acreage in development, the US EIA says the country is in position to boost LNG exports in the coming years.

Up to 55,000 BOE/D of output is expected from the ExxonMobil-operated Bajo del Choique-La Invernada block in the Argentine shale play, with a possible second phase producing up to 75,000 BOE/D.

The state-owned firm is looking within its home country, around Southeast Asia, and to the Americas—including shale—in an effort to maintain its forecast average yearly production of 1.7 million BOE/D over the next 5 years.

Vaca Muerta production is on the upswing. Will increasing activity propel the Argentine play to the ranks of US shale? Data suggest it is both already there and has a ways to go.

For the next several years, supplies of crude will depend on several macro factors. Some are easier to forecast than others.

Wells are starting to come on stronger than expected, which is putting a new emphasis on orginizing all the other ingredients needed for shale production: more rigs, roads, pipelines, water, and sand.

YPF has followed an unconventional path up the learning curve to develop the Vaca Muerta, which could be the first big ultratight play developed outside North America.

Añelo is a small town in an arid, sparsely populated area with a new supermarket, police station, bank, skate park, hotel, and hospital. In the past decade the population has roughly tripled to 7,000, and in 5 years, it is expected to nearly triple again to 20,000.

After Gustavo Astie, executive manager for ­unconventionals at YPF, presented what he thought was an aggressive growth plan for the coming year to YPF management, he was asked: Would it be possible to go faster?

A drive down a gravel road in the Loma Campana follows the steep early learning curve in the Vaca Muerta.