GeoPark Acquires Two Blocks in Vaca Muerta, Expanding Oil Production Capacity

What's Happening?

GeoPark Limited has announced its entry into Argentina's Vaca Muerta shale with the acquisition of two operated blocks from Pluspetrol S.A. The acquisition includes a 100% operated working interest in the Loma Jarillosa Este block and a 95% operated interest in the Puesto Silva Oeste block, with the remaining 5% transferred to the provincial energy company Gas y Petróleo del Neuquén (GyP). These blocks cover over 12,300 acres in a prolific shale play, currently producing between 1,700 and 2,000 barrels of oil equivalent per day (boed), predominantly oil. GeoPark estimates recoverable resources at over 60 million barrels and projects plateau production of about 20,000 boed by 2028, supported by a development plan of up to 55 wells. The $115 million acquisition, funded from cash on hand, is expected to close by the end of 2025, pending government approvals.

Why It's Important?

This acquisition marks a significant strategic expansion for GeoPark, enhancing its production capacity and reserves in one of the world's most promising unconventional oil plays. The move is expected to provide immediate production gains and long-term value, positioning GeoPark as a key player in the Latin American oil market. The development of these blocks could significantly boost local economic activity and energy production, contributing to Argentina's energy sector growth. The investment in infrastructure, including a new central processing facility, underscores GeoPark's commitment to maximizing the potential of these assets.

What's Next?

GeoPark plans to proceed with the development of up to 55 wells and the construction of a central processing facility with a capacity of 20,000 barrels of oil per day. The company will focus on securing the necessary government approvals to finalize the acquisition by the end of 2025. As production ramps up, GeoPark will likely engage with local stakeholders and authorities to ensure compliance and optimize operations. The success of this venture could lead to further investments and exploration activities in the region.