New CEO of Argentina's YPF takes control, reveals 100-day plan

07 May 2012 19:57  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--Miguel Galuccio, recently appointed chief executive of YPF by Argentine president Cristina Fernandez de Kirchner, took control on Monday of the newly expropriated energy company, the energy producer said.

"We want YPF to have national importance, be competitive, enterprising, modern, capable of delivering results to investors and an industry-leading player in the energy development of Argentina," Galuccio, an ex-Schlumberger executive, said after thanking the Argentine president for her appointment.

The Argentina House of Representatives on 3 May approved a measure allowing the government to take control of energy company YPF from Spain’s Repsol. The Senate approved the bill at the end of April.

Galuccio revealed a new 100-day plan to position the newly expropriated company.

"We have a concrete plan to be the world’s foremost expert in rejuvenation of marginal fields, a leader in the development of unconventional resources and exporter of professional service people for downstream projects throughout Latin America," he said.

The expropriation was sought by Argentine President Cristina Fernandez. The government announced plans last month to take control of 51% of the shares of YPF, saying the company had not done enough to develop the country’s energy resources.

The takeover followed more than two months of government pressure on YPF, a unit of Spain’s Repsol YPF, to boost investment and output.

The stake in YPF gives the Argentine government access to its shale oil reserves and natural gas production.

Argentina has an estimated 774,000bn cubic feet (bcf) of technically recoverable reserves of shale gas, the third-largest behind China and the US, according to a global shale gas study by the US Energy Information Administration (EIA).

YPF said in February that the Vaca Muerta formation in southern Argentina holds at least 23bn bbl of oil, of which at least 13bn bbl belong to the company.

YPF’s output accounted for about 34% of the nation’s production in 2011, according to Argentine energy secretariat data.

YPF is also the country’s largest fuel retailer and refiner, with 52% of refining capacity and one of the largest petrochemical producers.

YPF owns three industrial sites, including La Plata in Buenos Aires, Lujan de Cuyo in the state of Mendoza and Plaza Huincul in the state of Neuquen. YPF also owns half of the Refinor plant in the northern state of Salta, according to YPF.

La Plata refinery accounts for 30% of Argentina’s refining capacity and has a capacity of about 251,600 bbl/day of capacity. The plant also produces base oils, lubricants and asphalts.

Lujan de Cuyo represents 17% of national refining capacity and has a processing capacity of about 141,000 bbl/day, according to Repsol. The Plaza Huincul plant has a capacity of 33,500 bbl/day.

Repsol and the office of Cristina de Kirchner did not return phone calls or emails on Monday seeking further comment.

By: Leela Landress
+1 713 525 2653

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