- Companies
BUENOS AIRES, Dec 2 (Reuters) - Argentina's YPF (YPFD.BA) could make a return to debt markets next year, a company source said on Friday, as the state energy firm looks to spur growth in the country's huge Vaca Muerta shale region.
The potential debt raising would be the first since YPF last year restructured some $2.1 billion of debt with creditors amid a wider squeeze in credit access in Argentina.
YPF leads development of Vaca Muerta, a Belgium-sized formation in Patagonia's Neuquen province, which could in a few years help the country reverse a multi-billion dollar energy deficit and become a net energy exporter, analysts say.
YPF is likely to invest a bit over $5 billion next year, up from $4.1 billion this year, according to the source. There had been expectation investment could near $5.5 billion.
The exact investment figure will be confirmed at a Dec. 15 meeting to decide next year's budget, the source added. The planned investment would require YPF to take on new debt.
"We would need to take on some debt next year," the person told Reuters, adding that the company will need to consider inflation and fuel prices before estimating next year's cashflow.
Earlier this month, YPF posted quarterly profits nearly triple the figure a year earlier on surging prices and more production.
Looking to benefit from gas exports, YPF in September signed a deal with Malaysia's Petronas to advance a new pipeline set to link Vaca Muerta with a liquefied natural gas (LNG) plant.
The source said they expect the Petronas project to move forwards once Argentina's Congress backs a new LNG law, which supporters hope will stimulate billions of dollars needed to build expensive new LNG plants.
Congress is expected to vote on the bill in December or January next year.
"The agreement is coming along well," he said. "Once the law is in place, the confidentiality agreement ends and the two parties will meet with the Vaca Muerta gas producers."
Vaca Muerta gas producers are pushing for Argentina - which heavily regulates its energy market - to guarantee by law their capacity to meet LNG export commitments, as well as tax and exchange rate benefits.
Reporting by Eliana Raszewski
Editing by Marguerita Choy
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