* Repsol says planned to unveil YPF discovery in April
* Announcement scrapped once state moved to take control YPF
* Argentina may have huge shale oil, gas resources
(Adds YPF first-quarter earnings, CFO appointment)
By Alejandro Lifschitz and Karina Grazina
BUENOS AIRES, July 26 Spanish energy company
Repsol said on Thursday it found Argentina's first
shale oil resource outside the giant Vaca Muerta field shortly
before the government seized control of its YPF unit in April.
The discovery, in the San Jorge Gulf basin in Santa Cruz
province, where the majority of Argentina's crude is produced,
is further evidence the country may have some of the world's
biggest unconventional energy reserves.
Under Repsol's watch, YPF discovered the
shale oil in two exploratory wells on the Canadon Yatel and Los
Perales blocks. Additional studies determined that the deposit
to be prospected totaled some 10,800 square kilometers (4,200
square miles) - with YPF holding concessions in roughly half
A spokesman at Repsol in Madrid said YPF was going to make
the discovery public in April but those plans were scrapped when
the government appointed state administrators at the firm and
then nationalized it with congressional backing.
"The findings are the result of Repsol YPF's administration
and investments in recent years," the Repsol spokesman said.
A spokesman at state-controlled YPF said the company would
not comment on the information.
Argentina's Congress nationalized YPF on the grounds that
Repsol did not invest enough to sustain oil and natural gas
production amid burgeoning demand, forcing the government to
spend more on fuel imports.
Fuel purchases last year ate into Argentina's trade surplus,
which is a key source of foreign currency in a country that has
been virtually shut out of global credit markets since
defaulting in 2002 on a massive amount of debt.
Repsol denies the government's accusations and says its
investments in exploration helped uncover shale oil and gas
resources at a time when conventional fields were losing steam.
The Spanish company has vowed to fight to be compensated for
the state takeover. An Argentine panel will determine how much
to pay Repsol for its controlling stake in YPF, but government
officials have already said the amount will be well below the $9
billion to $10 billion Repsol is seeking.
Although the discovery in Santa Cruz may cover only about
one-third the size of the massive Vaca Muerta field, it is still
a potentially important find.
"If it's really 10,800 square kilometers, that's a very,
very big resource," an oil sector analyst in Buenos Aires said
on condition of anonymity, since he did not know firsthand the
details of the discovery.
Next year, YPF plans to drill 132 crude and 14 natural gas
wells at Vaca Muerta, which largely lies in Argentina's southern
province of Neuquen. The company has not said how it plans to
finance this $1.36 billion operation.
In early June, YPF said it needed to invest $7 billion a
year to increase production 26 percent by 2017.
Energy analysts say Argentina's development of shale
resources, which costs more than traditional production, will
likely be hindered by limited access to capital markets and
price controls that damp incentives to invest.
YPF belatedly published its first-quarter results on
Thursday, reporting a 27 percent fall in net profit to 1.29
billion pesos ($295 million) in the first three months of the
The company, which is expected to report second-quarter
earnings next week, also named Daniel Gonzalez -- a former
executive with Bank of America Merrill Lynch -- as chief
($1 = 4.38 Argentine pesos as of March 31)
(Additional reporting by Helen Popper; Writing by Hilary Burke;
Editing by Steve Orlofsky)