CHEVRON'S POSITIVE COMMENTS ON ARGENTINA VM SHALE
Chevron hosted an investor day conference call yesterday http://edge.media-server.com/m/p/qudsrzjc/lan/en which included some positive comments on the shale potential in Argentina.
Chevron plans to drill 4 wells targeting the Vaca Muerta shale on its El Trapial block. In Figure 1, we show that Chevron’s El Trapial block is located directly west to MVN’s Curamhuele block and directly east of BOE’s Los Toldos II block and north of Los Toldos I. MVN is also hearing that Chevron has drilled a very nice well adjacent to the Curamhuele block at location ET.x-2006 in the VM and that it is producing at significant rates.
Successful production tests of the VM shale and other shales by Chevron on its El Trapial block could increase interest in MVN’s Curamhuele block (90% W.I.). MVN continues to seek JV partners which we believe could be a key catalyst for the stock. Later this year, MVN plans to re-entre and test the CH.x-1 well on the Curamhuele block which flowed ~150 bbl/d, with no stimulation from a 225 metre thick Lower Agrio Shale section.
Drilling success by Chevron on El Trapial could also be positive for BOE who holds a 45% interest the offsetting Los Toldos blocks and a 90% interest in the Loma Ranqueles block.
Below is the transcript that discusses Chevron’s plans for the VM shale in Argentina:
- 140 VM wells in 2014: Progress is being made to develop the Vaca Muerta shale, the shale is thick and laterally extensive. Initial well tests indicated that this is a world class shale play and approximately 140 gross wells will be drilled in 2014.
- 80,000 bbl/d by 2017: Production is expected to grow to around 80,000 bbl/d by 2017, half of which will be Chevron’s share
- Four wells at El Trapial: The VM shale also underlays our existing El Trapial assets (Figure 1) in Argentina where we are testing four exploration wells in 2014 to further assess the shale potential.
- These plays all have exploration and development opportunities and will contribute valuable growth through the decade.
Figure 1. Chevron’s El Trapial block, located near to MVN and BOE blocks.
