Pampa, Mobil and Total sign US$520mn, 5-year Vaca Muerta deal

Wednesday, July 11, 2018

Argentina's Neuquén province has awarded the Sierra Chata unconventional concession to a consortium led by Pampa Energía, accompanied by ExxonMobil's Mobil Argentina and Total Austral.

The new 35-year concession for unconventional hydrocarbon exploitation in the block was agreed to with an investment of US$520mn in the first five years of the pilot phase. The block covers the development of unconventional shale and tight gas in the Vaca Muerta and the Mulichinco formations, respectively.

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According to a press release from Pampa, the block currently "produces natural gas from the Mulichinco formation (compact sands or tight gas), with 69 productive wells and 45 million cubic feet of daily net production."

As operator, Pampa holds a 45.6% stake, with Mobil Argentina and Total Austral holding a participation of 51% and 3.4%, respectively. Each firm in the consortium intends to invest the US$520mn according to their shareholding over the next five years.

Phase 1 of the TGS pipeline in Vaca Muerta will connect Sierra Chata to the area's main transport systems.