It was revealed on Friday that Exxon Mobil Corp may invest more than US $10 billion in shale drilling in Argentina’s Vaca Muerta region over the next 20 to 30 years.
The world’s largest oil explorer by market value has already sunk $200 million into exploratory drilling in Vaca Muerta — a geologic formation in the Neuquén Basin which could potentially contain the most abundant shale reserves globally.
Following a meeting with Argentine President Mauricio Macri on Thursday, Exxon CEO Rex Tillerson said that the company is planning to invest another $250 million into a pilot project in the region in the coming months.
Argentina reportedly houses around 802 trillion cubic feet of natural gas, with the majority of resources concentrated in the Neuquén province, including the Vaca Muerta stores. Exxon data has designated the region as one of four “key activity” areas in South America.
The success of this summer’s pilot project will determine whether or not Exxon will launch full-scale development at Vaca Muerta which will span up to three decades.
The Argentine government has estimated that Vaca Muerta would need long-term investment of $200 billion in order to reverse the country’s ongoing energy crisis.
Meanwhile, Exxon is recovering from a $35 billion wrong-way bet on US natural gas and and a Russian exploration project brought to a halt by sanctions.