BP and Bridas Complete Argentine Merger
BP confirmed December 18 that formation of Pan American Energy Group (PAEG), the new 50-50 joint venture owned by BP and Argentina's Bridas Corporation, has been completed.
The UK major said that PAEG is now the largest privately-owned integrated energy company operating in Argentina. The cash-free merger, announced September 2017, had originally been expected to complete in early 2018. It was formed by the combination of Pan American Energy (PAE) – a 60:40 joint venture of BP and Bridas Corporation – and Axion Energy which was wholly-owned by Bridas Corporation.
Bridas Corporation itself is a 50:50 joint venture of Bridas Energy Holdings of Argentina and Chinese state-owned CNOOC; the latter bought its stake in 2010 for $3.1bn.
PAE, which in 2015 had 983mn barrels of oil equivalent reserves in Argentina, issued a statement December 11 saying that it expected completion of the merger early 2018. It added that PAEG would become the main producer, employer and private investor of the oil sector in Argentina, also present in Bolivia, Mexico, Uruguay and Paraguay.
In July 2017, Argentina's state YPF, BP-led PAE, Total and Germany's Wintershall signed an agreement to invest $1.15bn through December 2021 to develop two key projects in the Vaca Muerta shale gas basin, adding to the $500mn already invested in 2014-16 in those areas.