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Argentina Denies Reaching Gas Deal With Russia's Gazprom

Russian Energy Minister Alexander Novak (R) and Gazprom CEO Alexei Miller wait for the start of gas talks between the EU, Russia and Ukraine in September.

Argentina's state-run energy company, YPF, said Wednesday that it had not struck a confidential natural gas production deal with Russia's Gazprom, despite a statement earlier in the day from the industry ministry saying that it had.

The ministry had said Cabinet Minister Debora Giorgi received assurances from Gazprom head Alexei Miller in a meeting this week that a "confidential" $1 billion agreement had been reached with YPF SA to explore for and produce gas in Argentina.

This came as news to YPF, which followed with a tersely worded statement of its own.

"YPF would like to clarify that while it has conducted important meetings with Gazprom officials to analyze various possibilities for business and collaboration, neither a confidential deal nor agreement memorandum has been signed," it said.

"As a public company with shares traded in New York and Buenos Aires, YPF will in a timely manner inform its stockholders of any relevant development," the YPF statement added.

No one from Gazprom was immediately available for comment.

On Tuesday, the state-controlled Russian energy giant put a statement on its website saying that Miller met Giorgi in St. Petersburg.

"The meeting participants looked at the development prospects for the bilateral cooperation in the gas sector, with an emphasis on exploration and production of gas from Argentine gas fields," the Gazprom statement said.

A Gazprom deal would be the second major investment for Argentina after Chevron Corp agreed last year to invest $1.24 billion in the Vaca Muerta [Dead Cow] shale formation in Patagonia, one of the largest such deposits in the world.

Other oil companies drilling in Vaca Muerta include Royal Dutch Shell and ExxonMobil.

Argentina is keen to reverse a costly energy deficit that is pressuring foreign reserves as Latin America's No. 3 economy is hit by fallout from the government's July bond default.

It will take Argentina up to a decade and as much as $200 billion in investment to erase an energy output deficit, YPF's CEO Miguel Galuccio said last month.

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