Desperate for investment, Argentina’s Congress gave final approval on Thursday to a controversial bill which will pave the way to revamp energy investment regulations as the nation looks to take advantage of its vast and mostly untapped shale and oil gas deposits to attract billions of dollars of much needed investment.
The controversial bill is aimed at bringing in a sizable amount of new investment into the nation’s energy sector which would help to reverse its gaping $7 billion energy deficit that is also drastically draining its foreign reserves.
The controversial bill, which was passed on Thursday by a count of 130 to 116 in the lower house, will cut the minimum investment needed by firms to be exempt from import controls to $250 million from previously $1 billion.
Argentina has one of the world’s largest shale oil and gas reserves in the world, but spends billions of dollars a year importing fuel, which has thus resulted in its $7 billion energy deficit price tag.
Argentina’s massive Vaca Muerta formation is estimated to hold around 23 billion barrels of oil and gas, a figure that rivals that of the U.S. Eagle Ford formation in South Texas, which is one of the largest shale gas sites in the U.S..
Argentina’s Vaca Muerta formation, which translates to the “dead cow” in English, has already attracted investment from energy giants such as Chevron and Gazprom.
Gazprom, whom is Russia’s state-owned energy giant, is the world’s largest natural gas extractor.
Argentina’s new energy reform is expect to triple the nation’s oil and gas production in the approaching decade, which will certainly aid the nation’s sluggish economy moving forward.