The role for gas in an integrated AmericasJavier IguacelMinister of EnergyJune 2018

How can we contribute to integrate America gas systems?

Our objective:

Transform Argentina into a World Class Energy Supplier through Vaca Muerta massive and

responsible development and through the fast incorporation of wind and solar renewable

energies.

2

Introduction

3

Vaca Muerta’s resources

Neuquina Basin

Sedimentary formation (Clay)

High organic content

Marine environment

201 M years

Max. thickness ≈ 700 m

Hydraulic stimulation

One of the greatest resources worldwide

Source: IEA

2013.

Unconventional Gas resources Unconventional Oil resources

35,000 km2

Volume generated (Vaca Muerta)5,000 Bboe

Hydrocarbon not stored

Volume in situ2,500 Bboe

Volume stored in conventional reservoirs40 Bboe (2%)

Volume stored in unconventional reservoirs2,460 Bboe (98%)

Bboe Produced: 8.5Remnant: 3.9Unrec.: 27.6

How much could be recovered?According to DOE 69 Bboe (3%)5% - 125 Bboe10% - 250 Bboe

P1+P2 ReservesArgentina6 Bboe

Source: IHS.

4

Argentina’s unconventional resources in context (v1)

4

4.4

27

Oil reserves and resources [Bbbl]

30.2

802

Natural gas reserves and resources [Tcf]

Conventional (3P + resources) Unconventional resources

Source: Energy Information Administration and Ministry of Energy (AR)

5

Current Players (Wood Mackenzie)

Costs decline as performance increases

6

26,9

16,113,1 11,9

16,412

9,1 6,9

2015 2016 2017 Q1 2018

Development cost OPEX

2,3

1,20,9

2,1

1,10,8

2016 2017 Q1 2018

Development cost OPEX

Shale oil costs – Loma Campana [USD/Boe]

Shale gas costs – El Orejano [USD/MMBTU]

1,4 1,41,7 1,9

1617

2021

2015 2016 2017 Q4 2017

Avg. lateral length [km] Avg. frac stages

3,052,27

1,63 1,39

2015 2016 2017 Q4 2017

Horizontal well cost

Loma Campana horizontal well costs [kUSD/lat. ft.]

Loma Campana horizontal well performance

Source: YPF

• Productivity is on par with the best US shale plays. With cost reductions of 10%, wells in all windows will offer returns over 20%.

• Liquids break even between 40 and 50 US$/bbl and dry gas breaks below US$4/mcf, both much below the current market prices.

7

Vaca Muerta Highlights

8

Vaca Muerta vs. Eagle Ford Gas Breakevens (Wood Mackenzie)

9

Type-well curves (Wood Mackenzie)

10

Horizontal Wells Value (Wood Mackenzie)

11

Vaca Muerta Progress (Wood Mackenzie)

12

Projects Status

Thankyou.Javier Iguacel

Minister of EnergyJune 2018

14

Vaca Muerta vs. Eagle Ford Liquid Breakevens (Wood Mackenzie)

Similarities with US’s plays

15Source: Energy Information Administration, US. June 2018 | * January- April 2018

Play TOC [%]Thickness

[m]Reservoir

pressure [psi]

Vaca Muerta 3—10 30—450 4,500—9,500

Barnett 4—5 60—90 3,000—4,000

Haynesville 0.5—4 60—90 7,000—12,000

Marcellus 2—12 10—60 2,000—5,500

Eagle Ford 3—5 30—100 4,500—8,500

Wolfcamp (Permian)

3 200—300 4,600

Source: YPF, 2014

Vaca Muerta vs.Major US unconventional plays’ physical properties

16

Vaca Muerta Windows (Wood Mackenzie)

Key players on Vaca Muerta formation (detail)

17

Unconventional Oil and Gas production is accellerating

18

0%

5%

10%

15%

20%

25%

30%

35%

-

0,2

0,4

0,6

0,8

1,0

1,2

1,4

1,6

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

*

Bcf

/d

Shale Tight % unconventional

0,0%

2,0%

4,0%

6,0%

8,0%

10,0%

12,0%

14,0%

-

10

20

30

40

50

602

00

8

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

*

Kb

bl/

d

Shale Tight % unconventional

Unconventional Oil production Unconventional Gas production

11.5%of 2018’s

oil production

31.9%of 2018’s

gas production

Source: Ministry of Energy | * January-April 2018

Similarities with US’s plays

19Source: Energy Information Administration, US. June 2018 | * January- April 2018

0

10

20

30

40

50

60

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

*

Bcf

/d

US’s dry shale gasproduction estimates

Play TOC [%]Thickness

[m]Reservoir

pressure [psi]

Vaca Muerta 3—10 30—450 4,500—9,500

Barnett 4—5 60—90 3,000—4,000

Haynesville 0.5—4 60—90 7,000—12,000

Marcellus 2—12 10—60 2,000—5,500

Eagle Ford 3—5 30—100 4,500—8,500

Wolfcamp 3 200—300 4,600

Source: YPF, 2014

Vaca Muerta vs.Major US unconventional plays’ physical properties

Note: Figures exclude Unconventional Resources

Oil & Gas Production (2017) and Reserves (12-31-2016)

Proved (P1) reserves

2.2 Bbbl 11.9 Tcf

Oil Gas

Probable (P2) reserves

0.8 Bbbl 5.2 Tcf

Oil Gas

Daily production

0.5 Mbbl/d 4.5 Bcf/d

Oil Gas

Currently 5 productive Basins600,000 km2

Austral Basin with offshore gas production

14 non-productive Basins

Source: Ministry of Energy