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ARTICLE · 19 APRIL 2017

Stimulus Program For Investments In Vaca Muerta Gas Production

Mitrani Caballero Ojam & Ruiz Moreno
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The Ministry of Energy and Mining published Resolution 46-E/2017, which created a program to stimulate investments in natural gas production projects in the Neuquén Basin's unconventional reservoirs.

ArgentinaEnergy and Natural Resources

The Ministry of Energy and Mining published Resolution 46-E/2017, which created a program to stimulate investments in natural gas production projects in the Neuquén Basin's unconventional reservoirs (the "Program").

The Program guarantees the following minimum prices for gas from unconventional reservoirs sold in the domestic market, starting in 2018 for a period of four years:

Year Minimum Price
2018

7.50 USD/MMBTU
2019 7.00 USD/MMBTU
2020 6.50 USD/MMBTU
2021 6.00 USD/MMBTU

The difference between the weighted average price effectively received by the producer for its gas sales - produced from conventional or unconventional reservoirs in the Neuquén Basin and sold in the domestic market - and the guaranteed Minimum Price under the Program, will be paid by the Republic of Argentina . The production company included in the Program will receive 88% of the price difference and the remaining 12% will go directly

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