ExxonMobil finds promising shale oil deposit in Argentina

ExxonMobil said it has found a promising shale oil deposit in southern Argentina, on par with some of the best of its kind in the United States. The US oil giant started work last year in Vaca Muerta, in Neuquen province, in the southern Patagonia region. Vaca Muerta is a huge deposit that ranks Argentina second in the world for shale gas reserves and fourth for potential shale oil reserves. The United States is the world leader in shale oil and shale gas reserves, and in related technology. Testing of the nonconventional well, which would require fracking, showed potential for a flow of 770 barrels per day, the company said in a statement. "It is a very important (potential) well, in terms of likely volume, on a par with the best (non-conventional) in the United States," said industry expert Eduardo Barreiro. A judge earlier this month said President Cristina Kirchner could be investigated for abuse of authority in a major Chevron fracking deal. Chevron and YPF also this month unveiled plans to spend another $1.6 billion to develop the Vaca Muerta shale formation for oil and gas projects. Kirchner is keen to get Argentina from spending billions of dollars on energy imports every year to self-sufficiency. The country's energy import costs hit $9 billion last year alone. The massive energy bill is a top economic concern, because Argentina is losing its hard currency reserves by buying imports. State oil giant YPF has dug 184 wells and is on target to have 300 open by year's end. Various new techniques for extracting oil and gas, notably "fracking" involving the injection of water and chemicals deep into rock to release reserves, have led to booming production in North America. The cheap resource is causing upheaval on world markets in what the International Energy Agency describes as an energy revolution. But critics point to studies that show fracking increases the risk of contaminating drinking water, warning of untold dangers to humans and livestock.