Argentina to push oil companies to invest more
By TAOS TURNER
Governors from Argentina's top 10 oil-producing provinces will meet next week in a bid to push oil and gas companies to increase oil and gas output.
The meeting comes during an intense escalation of government pressure on the industry to boost production after nearly a decade of declining reserves and output.
"The aim will be to get oil companies to produce more," said a spokesman for Chubut Governor Martin Buzzi, who leads the group, which goes by its Spanish acronym Ofephi.
In a speech last week, Argentine President Cristina Kirchner bashed the industry for declining output and called on oil companies to boost production.
She said this forced the government to import $9.4 billion in fuel last year, more than double what it imported in 2010.
The imports are crimping Argentina's trade surplus just as the government struggles vigorously to maintain it.
Kirchner said it is important for oil companies to remember that they are working on land owned by Argentines, implying that oil and gas concessions could be revoked if the companies don't do more to boost production.
"The group's work will be in line with the president's discussion of oil concessions and the need to meet promises to investment more," the spokesman said.
Both Kirchner and Planning Minister Julio De Vido have highlighted the group recently and seem set to work with governors to increase pressure on the oil industry.
In Argentina, provincial governments grant concessions, which can give them greater influence over companies than that held by the national government.
Among other things, the governors are considering the possibility of setting exploration, production and investment targets for the companies.
Dow Jones Newswires
From the Archive