Vista Energy plans to inject approximately $1.1bn (21.97bn pesos) into expanding its operations in Argentina’s Vaca Muerta shale formation this year, reported Reuters, citing CEO Miguel Galuccio.
The investment is aimed at enhancing production and cutting costs.
Speaking with the publication, Galuccio detailed the company’s strategy for the project.
It stands as the company’s priority initiative and a key element of Argentina’s efforts to address its chronic energy deficit.
The Vaca Muerta shale formation, said to be one of the world’s largest shale developments outside the US, has undergone rapid growth since its early days.
Galuccio reflected on its transformation, noting: “In 2012, Vaca Muerta was for believers. Today, Vaca Muerta is for engineers.”
Output from Vaca Muerta has more than doubled over the past year, reaching 65,000 barrels of oil equivalent per day (boepd) by the second quarter (Q2) of this year.
The growth trajectory is expected to continue, with projections suggesting output could hit 85,000boepd by Q4 and potentially reach 100,000boepd by 2026, aiming for 150,000boepd by the decade’s end, Galuccio noted.
To support this expansion, Vista Energy plans to develop additional wells and infrastructure in Argentina’s Neuquen province, where the company has already identified 1,150 new well locations spanning more than 200,000 acres.
Earlier this year, Vista added a third drilling rig to its operations in Vaca Muerta and intends to introduce a second fracking crew by the end of the year.
Fracking, which involves injecting sand, chemicals and water into shale rock to extract oil and gas, has faced environmental criticism due to its potential impact on aquifers and its association with increased seismic activity.
Despite the environmental concerns, Vista Energy is focused on optimising extraction costs.
The company reported lifting costs of $4.50 per barrel (bbl) for Q2 and aims to reduce these costs by around 11% to $4/bbl by 2026, down from $18/bbl when production first began.
Galuccio also highlighted infrastructure challenges, particularly the limited pipeline capacity, which was a significant bottleneck last year.
Plans are under way to address these issues by doubling the capacity of Oldelval’s pipeline network and expanding the Vaca Muerta Sur and Norte pipelines.
He emphasised the need for further investment and development in Vaca Muerta, stating: “Vaca Muerta needs more Vistas and more investment” to fully realise its potential and support Argentina’s energy needs.
“Vista Energy to invest more than $1bn in Argentina’s Vaca Muerta Shale ” was originally created and published by Offshore Technology, a GlobalData owned brand.
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