Americas Petrogas Argentina and ExxonMobil Exploration Argentina have inked a deal to explore and produce oil and gas from Petrogas' Los Toldos blocks, comprising of 163,500 acres, Petrogas said in a statement Tuesday.
The Los Toldos blocks are in the western region of the Neuquen Basin in Argentina and is in close proximity to recent shale oil and gas discoveries in the Vaca Muerta formation.
ExxonMobil has a 45% interest in the Los Toldos blocks with Americas Petrogas having 45% interest and the government entity, Gas y Petroleo del Neuquen (G&P) 10%.
ExxonMobil, as part of the deal, is to commit $53.9 million in the exploration phase and another $22.4 million if both companies proceed with production phase.
"Americas Petrogas is the operator of the Los Toldos blocks and expects to spud the first well in the fourth quarter of 2011 with the primary target being the unconventional Vaca Muerta formation and potential secondary targets in other conventional and unconventional formations," the statement said.
"We believe the next major shale development outside of North America will be in the Neuquen Basin. Our Argentina management and technical personnel look forward to working with ExxonMobil to explore the substantial hydrocarbon potential of the Los Toldos blocks," Managing Director of Americas Petrogas' Argentina subsidiary, Guimar Vaca Coca said in the statement.
This deal is subject to approval by G&P.
