Buenos Aires, Jul 5 (IANS/EFE): YPF, the oil company controlled by the Argentine state following the expropriation of a 51 percent stake from Spain's Repsol, and US supermajor Chevron Corp. plan to sign an agreement July 16 to develop the Vaca Muerta shale oil and gas field in southwestern Argentina, an official said.
The agreement will be signed in Buenos Aires during a ceremony that will be attended by John Watson, the CEO of San Ramon, California-based Chevron, Neuquen Gov. Jorge Sapag said.
"The bet being made by YPF and Chevron is an extremely important one for the province so it will have more investment in all gas and petroleum areas, and also for production, royalties, taxes, the stimulation of economic activity," Sapag said in a radio interview whose transcript was posted on the Neuquen government web site.
YPF and Chevron signed an agreement in May outlining the commercial terms and conditions for developing Vaca Muerta.
Under the terms of the deal, first announced last December, Chevron is to invest up to $1.5 billion in a pilot program aimed at developing shale deposits in Vaca Muerta's Loma La Lata Norte and Loma Campana blocks.
The pilot project will involve the drilling of more than 100 wells over the next 12 months, YPF said.
YPF announced the discovery of non-conventional oil and natural gas reserves in Vaca Muerta in 2011 after successful results in the exploration phase.
Development of that region, which has already begun on a small scale, is seen as a solution to Argentina's current energy deficit.