And Argentina just got a big boost.
The country's state-run oil and gas firm YPF told local press late last week that it is making substantial progress on unconventional production. With the company noting that its output from shale leaped 7 percent during the third quarter -- equating to a rise of 2,900 barrels of oil equivalent per day, to a total output of 46,200 boe/d from unconventional sources.
That's an encouraging performance and it looks like the coming months could bring even more good news for Argentina's emerging shale industry. Related: Global Rig Count Continues Steady Decline
YPF said it has just completed two wells targeting a completely new shale field called La Ribera -- a step out from the company's existing projects in the Vaca Muerta play of Argentina's western region.
If successful, the La Ribera play could add substantially to output and reserves already coming from YPF's established unconventional fields which include joint ventures with major international players such as Chevron and Petronas.
YPF also noted that another of its shale joint ventures -- with natural gas end-user Dow Chemical -- is also set for a significant rise in output. With production from this play expected to top 1 million cubic meters per day (35.3 MMcf/d) by the end of 2015. Related: Energy Storage Could Become The Hottest Market In Energy
All of this development is being supported by a reformed natural gas pricing system in Argentina -- which pays better rates for production from unconventional fields. In fact, YPF's management noted they are doing everything they can to shift production toward natgas and away from oil -- completely the reverse of the situation in North America the last several years.
Reports also suggested that YPF is continuing to look for new 50/50 partners on shale projects. Watch for new deals being struck here, as a gauge of whether Argentina is indeed pulling ahead in the race for the world's next big shale profits.
Here's to a new generation,
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