Argentina oil and gas watch: Petroquímica Comodoro Rivadavia investment, national hydrocarbons output

Argentine province Mendoza granted a 10-year extension to a hydrocarbons extraction license held by local construction, power and oil and gas firm Petroquímica Comodoro Rivadavia (PCR).

The license, which was due to expire in 2025 and will now end in 2035, corresponds to the CNQ-1 El Sosneado acreage, according to information in a regulatory filing.

Under the terms of the extension, PCR is required to invest US$19.0mn in drilling and well-repair work through 2024, as well as carry out environmental and other work through 2035. Subject to certain conditions being met, PCR may also need to spend US$6.5mn on additional exploration and development well drilling.

In terms of natural gas, El Sosneado was PCR’s lowest-producing asset in March, pumping out 21,710m3/d of the company’s total 729,140m3/d tally. 

In terms of oil, El Sosneado was the company’s third-biggest producing asset, registering 153m3/d in March out of total output of 1,446m3/d. 

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Argentine oil and gas production climbed 12.6% and 11.1%, respectively, year-on-year in April.

Output of unconventional hydrocarbons offset negative growth in production of conventionals, according to data from think tank the General Mosconi energy institute.

Unconventional oil production, chiefly from the Vaca Muerta formation, rose 53.7% to 37,300m3/d in April, while output of conventionals fell 4.9% to 54,300m3/d.

Unconventional gas production rose 42.3% to 67.5Mm3/d, as conventional gas output dipped 10.9% to 59.5Mm3/d.

Argentina needs to build out midstream infrastructure to support sustained output growth from Vaca Muerta. Oil pipeline capacity and overhaul work has got underway and a tendering process for the first phase of a major trunk gas pipeline – the Presidente Néstor Kirchner duct – has been launched, although the project is subject to a legal probe over alleged irregularities in the tender process for the pipes, claims that have been denied.   

Authorities want to bring the first phase online in around a year, a target seen as feasible but difficult to hit.