Governance framework for hydrocarbon development in Argentina. The case of Vaca Muerta

Abstract

Law N° 26.741/12 law established State control recovery of Yacimientos Petrolíferos Fiscales (YPF), stating self-sufficiency achievement as a priority along with Argentina’s hydrocarbon sovereignty. Thereafter, new authorities of the recently nationalized company aimed to replace increasing energy imports, derived from oil and gas domestic extraction decline. Maturity of traditional over-exploited wells, directed expectations to Vaca Muerta, an oil and gas shale play located in the Neuquén Basin. In 2013, presidential Decrees 927 and 929 introduced incentives to attract investments and satisfy concessionaires’ demands, in particular those related with exports and overseas profit conveyance. In October 2014, Law N° 27.007 was sanctioned which modified Law N° 17.319. The latter is in force since 1967 and is considered the hydrocarbon industry’s "Mother Law". The new legislation incorporates advantages set out by the previously implemented decrees, favoring operators’ benefit maximization. Current National Government´s guidelines deepen this approach. The purpose of this work is to analyze policies driven to promote hydrocarbon exploitation in Argentina, as well as its territorial incidence, focusing on the experience of Vaca Muerta. Based on previous own research, the methodology includes regulations’ reviewing, indicators’ analysis and site observation, among other techniques. The concept of governance will be examined as the neo-liberal rationality feature, considering that it helps to reflect on the current State’s role.