Argentina’s oil and gas company YPF has reported a 12.7% year-on-year drop in its natural gas production during the second quarter of 2020, on the back of market conditions.
The state-run firm said in its Q2 financial results report that gas production averaged 35 million cubic meters per day (Mmcm/d), compared with 40.1 Mmcm/d a year earlier. The volume is also 8.4% lower than in the first quarter of 2020.
The reduction was driven “by the natural decline of the fields due to the decrease in activity negatively affected by a context of excess supply and lower demand,” YPF said on Wednesday.
Its natural gas realized prices fell 36.1% in the period to $2.51 per million British thermal units (MmBtu), from $3.93/MmBtu in 2Q19. In Q1, prices averaged $2.77/MmBtu.
The company expects its realized gas prices to improve based on the recently announced new Plan Gas 4, a government subsidy scheme to be launched in September/October. (See related story)
YPF said it has fully restored production at Vaca Muerta, and sees potential for near-term low-cost expansion based on DUC wells – 71 shale oil and 10 shale gas.
Shale gas production in Q2 amounted to 7.8 Mmcm/d, while tight gas development recorded 8.4 Mmcm/d of gas output.
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