Chevron, YPF among oil drillers backing Vaca Muerta pipeline

(Bloomberg) – Chevron Corp., YPF SA and other oil drillers are planning a major Argentine pipeline to handle rising output from the Vaca Muerta shale region.

The companies, through the Oldelval SA joint venture, are in talks to increase oil-shipping capacity from Puesto Hernandez, a promising drilling zone more than 100 kilometers (62 miles) distance from the Vaca Muerta’s traditional heartland, according to an Oldelval spokesperson.

The pipeline is seen as integral to enabling Oldelval’s shareholders to start production at the following fields:

• Chevron at El Trapial
• Pluspetrol SA at Bajo del Choique-La Invernada
• YPF at Bajo del Toro and Narambuena
• Tecpetrol SA at Los Toldos

The new conduit will connect to Allen and hook up to trunk lines that take Argentine oil to Atlantic coast export terminals. The pipe will be built alongside an existing line from the 1970s, roughly doubling overall capacity for the route to about 300,000 barrels a day (bpd).

YPF declined to comment for this story. Chevron and the other partners in the venture — Pluspetrol, Tecpetrol, Pampa Energia and Pan American Energy — didn’t immediately respond to inquiries left outside of regular business hours.

Crude output from the Vaca Muerta already stands at about 450,000 bpd. Pipeline bottlenecks have been one of the issues holding back development.

Image: YPF