Argentina's YPF pledges to continue gas supplies

Argentina's YPF oil company announced Saturday it would continue to provide liquefied natural gas to local customers despite the decision of Spain's Repsol to cancel deliveries. Repsol had been the majority owner of the Repsol YPF business alliance until the Argentine government decided this month to nationalize the company. The team charged with expropriating Repsol's interest, headed by Argentine Federal Planning Minister Julio de Vido, said in a statement the company would increase supplies of liquefied natural gas (LNG). "There will be five million additional cubic meters per day" because of greater production and increased purchases from Bolivia, the statement said. Late last year, Argentine public energy company Enarsa Repsol contracted to buy 10 of the 81 LNG shipments Repsol planned to import into Argentina in 2012 to alleviate a shortage of local production. The first delivery was scheduled for May 14. During the controversy over the Argentine government's decision to expropriate 51 percent of the shares of YPF from its Spanish owners, Repsol informed Enarsa it was suspending delivery of the LNG. YPF produces 34 percent of Argentina's oil and 25 percent of its gas, and the company holds some 54 percent of the nation's refining capacity, according to the private Argentine Petroleum Institute. When President Cristina Kirchner announced April 16 that Argentina would nationalize Repsol YPF, she said the decision was prompted by Repsol's lack of investment in YPF. As a result, she said Argentina was forced to import about $9.3 billion of oil in 2011, while this year oil imports are estimated to reach $12 billion. Repsol responded with paid advertisements in Argentina saying the company has invested $20 billion in Argentina, the largest investment in the country's history. The legislative proposal to nationalize Repsol's interest in the oil company is expected to be enacted next week by Argentina's Congress. The measure has drawn huge opposition from Spain, the European Union and the World Bank.