Apco sees Vaca Muerta learning curve in Argentina

By OGJ editors

Multistage fracturing of the Vaca Muerta shale is expected to take place later this year in both the Coiron Amargo and Bajada del Palo concessions in Argentina, said Apco Oil & Gas International Inc., Tulsa, Okla.

Exploration of the Vaca Muerta in the Neuquen basin is in early stages, and at this point the formation’s productive behavior is not well understood, the company said.

Nevertheless Apco, which has expanded into Colombia after having operated in Argentina for more than 40 years, reported encouraging test results at the CAS x-1 well after a multistage fracture of the Vaca Muerta. The well was tested for 48 days and produced intermittently for the equivalent 20 days with an average oil flow rate of 173 b/d and is now on production.

“In recent months,” Apco noted, “the Argentine government asserted that exploration and production companies operating in Argentina had not invested sufficiently to overcome domestic production declines, resulting in reduced levels of oil and natural gas production as well as reductions in oil and natural gas proved reserves.

“On that basis, various provinces rescinded several of YPF’s concessions and two nonproducing concessions from two other oil and gas companies. On Apr. 16, 2012, the federal government took actions to expropriate from Repsol a majority interest in YPF, the largest hydrocarbon-producing company in Argentina.”

Ralph Hill, Apco’s chief executive officer, said, “We feel that because of YPF’s sheer size within Argentina’s hydrocarbon sector, the government was primarily focused on YPF as the main contributor to the cost of its energy subsidies.” Apco’s track record has resulted in increased production and reserves growth for many years, Hill added.

In the first quarter of 2012, Apco made large 3D seismic acquisition investments on its properties in the San Jorge basin of Argentina and in the Llanos basin of Colombia.

Maniceno-1, Apco’s first exploratory well in Colombia, in which it has a 20% working interest, went to 11,027 ft measured depth on the Llanos 32 block and cut 50 ft of oil column at the top of the Mirador formation. Perforated across a 14-ft section, it produced oil on a jet pump at a rate of 7,558 b/d for 4 hr. It also flowed 3,036 b/d, natural, over a subsequent 6-hr period (OGJ Online, May 4, 2012).

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