Argentina has launched its biggest Vaca Muerta shale bid round in a decade, offering 15 exploration blocks as energy companies and importing nations seek more reliable crude supplies amid heightened Middle East tensions.
The auction, run by Neuquen provincial energy company Gas y Petroleo del Neuquen (GyP), comes as concerns over disruption to oil flows through the Strait of Hormuz sharpen interest in supply sources outside the region.
* Consultancy Rystad Energy said Vaca Muerta, the largest commercial shale play open to international oil and gas companies outside North America, could produce more than 1 million barrels per day of crude by the end of the decade.
* The blocks on offer stretch across the basin, from condensate-rich areas in the northwest to oil-focused acreage in the northeast and frontier zones in the south. The round is more than double the six blocks offered in the previous provincial auction.
* Rystad said the sale gives international firms one of their best chances in years to secure fresh acreage in Vaca Muerta, where most recent deals have involved acquisitions and farm-ins rather than new licenses.
* Interest has grown as pipeline and export infrastructure expands. Rystad said breakeven prices in the most prospective blocks range from $32 to $49 per barrel, making them competitive with established global shale plays.
* U.S. producer Continental Resources recently acquired a 90% stake in the Los Toldos II Oeste block and later farmed into Pan American Energy assets, underscoring rising overseas interest.
* Bidders will compete on carried working interest for GyP, royalties above a 15% minimum, work commitments and an access bonus starting at $500,000 per block.
(Reporting by Kylie Madry)