The province of Neuquén (Argentina) has awarded the Los Todos II Oeste area concession to ExxonMobil, located in the Vaca Muerta shale play. The Vaca Muerta shale play has estimated gas reserves at around 8,700 bcm and oil reserves at 16.2 Gbl. ExxonMobil is the operator of the block with a 90% stake, together with the provincial oil & gas company Gas y Petróleo del Neuquén.
In May 2020, the Argentinian government set a minimum oil reference price for local producers at US$45/bbl, with the objective to increase domestic production and to limit imports. The country would take the price of Medanito, a light crude from the basin of Neuquén, as a reference. The minimum oil reference price will remain in place until 31 December 2020.
The average break-even oil price for most Argentinian producers is estimated at more than US$30/bbl but can be higher than US$50/bbl for projects in the Vaca Muerta shale gas play in the Neuquén province. Shale gas production from Vaca Muerta has increased steadily in the last two years and the country bets on the Vaca Muerta field to improve domestic energy supply and begin natural gas exports.