The Argerich exploratory well will have more than 2,500 metres of drilling. It will be the deepest in the country’s history. The discovery of crude oil is key for Argentina’s offshore development. What is the timetable until production.
The Argerich exploratory well in Block 100 of the Cuenca Argentina Norte 100 (CAN 100) will begin drilling in April. The vessel that will carry out the work to search for oil in the Argentinean Sea is the Valaris DS-17, which is currently operating offshore Rio de Janeiro. Sources with knowledge of offshore exploration work in the country consulted confirmed that “drilling will take place in April. It is a complex project because, in addition to the drilling vessel, it requires support vessels and helicopters, among other equipment”.
The Argerich project in CAN 100 (15,012 km2) is operated by the Norwegian company Equinor, which owns 35% of the development. YPF (35%) and Shell (30%) are partners. Last year the Ministry of Environment authorised exploratory drilling in the time window from 15 December 2023 to 15 June 2024.
The Argerich well will be drilled 315 kilometres from the port of Mar del Plata. It will be the first to be drilled in the country in ultra-deep water, as it will be 2,500 metres above the seabed and will be 106 centimetres in diameter at the surface of the sediment. The drilling will be more than 4,000 metres above the ground.
Preliminary studies carried out by YPF estimate that there could be a field with the capacity to produce 200,000 barrels of oil per day (bpd). In comparison, according to data from the consultancy firm Economía y Energía (EyE), between January and September 2023, total crude oil production in the country (adding conventional and non-conventional) was 641,700 bpd, which – in turn – was 9% higher than that produced during the same period in 2022.
Drilling work is estimated to take 55 to 65 days. In other words, drilling at Argerich will be completed in June. So far, the deepest offshore well drilled in Argentina is 500 metres deep and 320 kilometres from Tierra del Fuego.
If the existence of oil in Argerich is confirmed, as this well is not tested, it is expected that next year the companies will carry out an appraisal (delineation) campaign to determine the size of the field and the levels of productivity, among other technical aspects that the companies will obtain. This will then allow them to design the drilling of production wells. In this scenario, Equinor, YPF and Shell plan to drill 30 production wells. This would allow YPF alone to double the company’s current production and reserves in the future.
It is estimated that the production wells drilled will be in place by 2027 and 2028. The Floating Production, Storage and Offloading (FPSO) unit will be permanently connected and could start producing in 2030 or 2031. The produced oil would be directly evacuated with tankers.
The expectation of finding hydrocarbons in CAN 100 is high because several similar fields have been found offshore Namibia. Why is it relevant to the Argentinean Sea? According to previous studies, the main rock in the North Argentine Basin is associated with the proven source rock in thickness and hydrocarbon content of the African margin of the Atlantic Ocean. Specifically, geologists in Argentina link the CAN blocks to large offshore discoveries off the coast of Namibia.
In 2022 and 2023, huge light oil discoveries were made in deep water offshore Namibia in the Venus field, operated by TotalEnergies, and the Graff field, operated by Shell. The estimated resources in both are several billion barrels of oil. For this reason, the possible discovery of crude oil determined by the drilling of the Argerich well is relevant for the sector.