Argentinian energy company YPF and Malaysia’s Petronas will come together to invest US$2.3 billion over the next four years in the Vaca Muerta shale oil fields,
Petronas will have an equal stake in the project through its subsidiary Petronas E&P.
The Vaca Muerta deposit is located in western Argentina, and is thought have the world’s second-largest shale gas and fourth-largest shale oil deposits.
“This investment will allow us to increase YPF’s petrol production by 30 percent by 2022, which will represent a total increase for Argentina of 15 percent,” a representative said.
The companies aim to reach a production equivalent of 60,000 barrels a day by 2022, with total investment potentially reaching US$7 billion within 20 years.
Successive governments have targeted Vaca Muerta to reverse Argentina’s energy deficit but the plans have been hindered by a lack of infrastructure.
YPF chief executive Daniel Gonzalez told Reuters that the company would bolster both unconventional oil and gas production by investing between US$4 billion and US$5 billion per year through 2022.
Petronas and YPF previously partnered in pilot exploration and production initiatives and will begin development of the unconventional fuel project in the Amarga Chica block in the province of Neuquen.