President Cristina Fernández de Kirchner is expected to announce a new economic structure for Argentine oil company YPF at tomorrow’s meeting with province governors. The decision will come after weeks of plummeting stocks and highly publicised discontent with YPF’s Spanish majority stakeholders, Repsol.
Earlier today, Pagina 12 cited Neuquén province governor Jorge Sapag as saying that Argentina’s largest oil and gas producer will soon be reconfigured as a “mixed” capital structure, built of both public and private sector shareholders.
“We think there is going to be news in the meeting the president has called for Thursday,” he said. “The state will probably want to rule a mixed economy, and encourage private investment.”
The statements came following the governor’s meeting with planning minister Julio De Vido. Although Sapag did not mention De Vido’s in his statements, he did include president Fernández’s sentiments.
“There is no time to lose,” he said. “I spoke with the president of the nation, [and she is] ready to receive capital from all over the world.”
Spain’s Repsol currently owns more than half of the oil company, after former president Carlos Menem’s decision to privatise it in 1993.
Ever since then, several detractors and political parties have called for the re-nationalisation of the oil resources.
Their voices grew louder as the provinces of Chubut and Santa Cruz expired four concessions with the company. The governors of the provinces cited a lack of YPF’s promised investment in exploration and production.
The rocky political waters have caused Deutsche Bank to cut its rating on shares of YPF.
“Since the start of the conflict between YPF and the government, we were hopeful for a better resolution,” said a Deutsche Bank report published by Dow Jones. “But the removal of concessions and the possibility of the government becoming a shareholder of the company indicate that the upside is limited from current levels, at least in the short term.”