By Michael Erman and Karina Grazina
NEW YORK/BUENOS AIRES, Nov 22 (Reuters) - Apache Corp is in talks with Argentina's state-controlled energycompany YPF about a possible sale of its assets in theSouth American country, sources told Reuters on Friday.
U.S.-based oil and gas Apache has stakes in about 25 fieldsin Argentina. In May the company - which also has oil and gasoperations in Egypt, Australia and the North Sea - announcedplans to sell $4 billion of assets to cut debt and shore up itsbalance sheet and share price.
Sources in New York and Buenos Aires, who asked not to benamed, said Apache and YPF were talking about the possible saleof at least some of Apache's Argentine investments. Apache alongwith other global oil companies has rights to Argentina's giantVaca Muerta shale oil and gas field.
The formation, in the southern Patagonia region, has 661billion barrels of oil and 1,181 trillion cubic feet of naturalgas resources, according to YPF.
Apache holds rights to areas in Neuquén, Río Negro, Tierradel Fuego and Mendoza provinces. Assets in Argentina wereresponsible for around 6 percent of the company's productionlast year and 3 percent of its proved reserves at year end.
Apache spent more than $16 billion acquiring oil and gasproperties over the last three years. Now the company is sellingoff assets as it has struggled to grow production.
The company struck a deal in July to sell its assets in theshallower continental shelf region of the Gulf of Mexico toprivate equity firm Riverstone Holdings LLC for $3.75 billion.
A U.S. Department of Energy report has shown Argentina holds802 trillion cubic feet of commercially viable natural gasresources trapped in shale rock and 27 billion barrels of oil,the bulk of it located in Vaca Muerta.
That would make Argentina the second largest holder of shalegas reserves after China and No. 4 in shale oil.
Argentina is counting on Vaca Muerta to recover the energyself sufficiency it lost a decade ago. The government has had tospend millions of scarce dollars importing energy, eroding itstrade surplus.
- Investment & Company Information
- Apache Corp