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Written by Amir Richani for IIR News Intelligence (Sugar Land, Texas)
Summary
A joint venture between Continental Resources and Mercuria Energy plans to expand in Vaca Muerta by raising production fourfold in the coming years.
A Promising Partnership
Continental Resources Incorporated signed a heads of agreement to acquire a 50% interest in Phoenix Global Resources, a subsidiary of Mercuria Energy Group that operates in Argentina’s Vaca Muerta formation. The joint venture expects to deploy more than US$4 billion to increase Phoenix’s output from 28,000 barrels of oil equivalent per day (boed) to more than 100,000 boed over the next five years.
The companies did not announce detailed plans about the distribution of the investments or the production growth across assets.
Together, the companies will develop Phoenix’s current interests at Mata Mora Norte, Mata Mora Sur, Confluencia Norte and Confluencia Sur, which are producing more than 24,000 boed with only 15% of the acreage so far developed.
Additionally, the planned joint venture’s plan will include the development of Continental’s operated interests in Los Toldos II Oeste. The companies also reported that additional interests are being acquired at the Bajo del Toro Este block, currently owned by Integra.
Industrial Info Resources offers more information on these developments in its Global Market Intelligence (GMI) Oil & Gas Plant and Project databases, where readers can find details–including construction schedules, investment values and necessary equipment–in reports on Mata Mora Norte, Mata Mora Sur and Los Toldos II Oeste, and a list of reports on Confluencia Sur.
Industrial Info Resources is tracking nine projects owned by Phoenix, amounting to roughly US$223 million of investment. Readers can learn more from a detailed list of project reports.
“The reforms led by President Milei and his administration generated our interest in Argentina and strengthened our confidence in its future, ultimately helping pave the way for this significant partnership,” said Doug Lawler, the chief executive officer of Continental, in a press release. “Mercuria has been an exceptional partner, and we have tremendous respect for the strong operating platform and track record Phoenix has established in Vaca Muerta.”
The companies expect the projects to qualify for Argentina’s Large Investment Incentive Regime (RIGI), which provides long-term fiscal and legal benefits to companies investing more than US$600 million for new upstream developments.
Moving Pieces
Similarly to Continental, other companies have expanded their positions across Vaca Muerta since 2024 with the goal of boosting production in the shale reservoir. Those include Pluspetrol, which acquired the Bajo del Choique- La Invernada and has since applied to develop the assets under the RIGI.
In the last two years, YPF has also acquired stakes at the Sierra Chata, La Escalonada, Rincon La Ceniza, Bandurria Sur and Bajo del Toro, while GeoPark acquired the Loma Jarillosa Este and Puesto Silva Oeste blocks, and Vista Energy joined YPF at the Bandurria Sur and Bajo del Toro.
While some companies bet on developing Vaca Muerta, others have exited or reduced their exposure at the shale play in the last few years, including Exxon Mobil Corporation, Equinor ASA and Petronas.
The prospects of Vaca Muerta’s boom continue to grow as Argentina oil production surpasses 900,000 barrels per day (bpd) of oil, with government and insutry forecasts suggesting output could reach 1 million bpd by year-end.
However, Argentina’s hydrocarbon growth is not merely focused on oil production, but also on the expansion of natural gas and liquefied natural gas (LNG) exports. The country is advancing major LNG export projects, including Southern Energy‘s floating LNG development and the proposed Argentina LNG project led by YPF, Eni SpA and XRG.
Readers can learn more from detailed reports on Southern’s LNG development and the Argentina LNG project.
Key Takeaways
- Continental and Mercuria plan a joint venture to expand production in Vaca Muerta.
- The companies target more than US$4 billion to raise production to more than 100,000 boed.
- GeoPark, Vista Energy, Pluspetrol and YPF recently have increased their stakes in Vaca Muerta.
About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news, and analysis on the industrial process, manufacturing, and energy-related industries. IIR’s Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified, and verified plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).
