Chevron plans to drill 120 wells for unconventional resources in Argentina over the next three years, betting on the country's shale potential, an executive said Thursday.
The drilling will be in the Vaca Muerta play in the southwestern Neuquen Basin, Ali Moshiri, head of Chevron's exploration and production business in Africa and Latin America, said at a business conference in Buenos Aires.
Moshiri said the program will begin this year with the drilling of three exploratory wells at El Trapial-Curamched, the company's biggest oil field in Argentina and the second-biggest in the country.
"We believe it is the right environment" to invest in Argentina, Moshiri said, adding that the company is open to more opportunities such as partnerships including with YPF, Argentina's state-run oil company.
"We are betting on shale in Argentina," he said. "It is a risk we are going to take."
Moshiri declined to provide an investment figure when asked on the sidelines of the conference, other than to say that each well would cost around $15 million to drill and that shale drilling on the whole is extremely capital intensive.
That means the company could spend about $1.8 billion on the 120-well program.
"The investment can be as big as the opportunity allows," he said, adding that the company is looking at different parts of the country for possibilities.
"I believe that Argentina can become an exporter of natural gas and position itself as a leader in shale in Latin America," he said.
Chevron produces 5.5% of the country's 570,000 b/d of crude output and 0.6% of its 120 million cubic meters/d of gas, with operations concentrated in the Neuquen Basin.
