Subject
The Vaca Muerta shale formation.
Significance
Argentina’s huge Vaca Muerta shale formation is now beginning to be exploited. With the recovery in global oil prices likely to be sustained over the short-to-medium term, the international oil industry is cautiously and selectively regaining its investment appetite.
Impacts
Falling conventional hydrocarbons investments as attention shifts to Vaca Muerta may affect output if shale does not meet expectations.
If the government’s investor-friendly approach fails to yield positive results, reversal of its often-unpopular economic policies is likely.
Failure to meet output aspirations would sustain heavy dependence on energy imports.