Spain’s largest integrated oil and gas company  Repsol  YPF (REP) entered into an agreement with the Bolivian Government to develop the Caipipendi block. This block is located in the Tarija and Chuquisaca regions, south of Bolivia. The block includes the Margarita and Huacaya fields, the latter being one of the 5 largest gas finds made worldwide in 2008.

The block contains resources of 3.7 trillion cubic feet, which is equivalent to three years of Spanish gas demand. It will be developed and exploited by a consortium made up of Repsol (37.5% – the operator), BG (37.5%) and PAE E&P Bolivia (25%).

Repsol will invest 400 million euros (nearly $600 million) and raise its gas production sevenfold to reach a daily production of 14 million cubic meters in 2013. The reources will be added to the company’s reserves in the coming months.

We believe that this agreement will help the company to increase its proved reserve base, which has had a declining trend in the past few years. Repsol’s year-end 2005 proved reserves were roughly 35% below the year-earlier level. Proved reserves dropped by more than 20% in 2006. In 2007 and 2008, the company’s proved reserves declined by a further 8% during each year.

We are maintaining our Neutral recommendation for the stock, given the company’s weak reserve base, poor reserve replacement track record and higher unit finding and development costs.

Zacks Investment Research

1. (REP) REPSOL YPF S.A. Remains NeutralREPSOL YPF S.A. (REP) reported third-quarter earnings of 30 euro-cents per share (45 cents per...
2. (REP) Repsol YPF S.A. Confirms Gas in VenezuelaFollowing the test on recently found gas resource in the shallow waters of the Gulf...
3. (REP) Repsol YPF SA to Invest in Bolivian Natural Gas ProductionRepsol YPF SA (REP) on Wednesday said it will invest approximately $1.6 billion in Bolivia...
4. (REP) Repsol YPF S.A. Strikes Gold in VenezuelaRepsol YPF S.A. (REP) recently found a huge gas resource in shallow waters of the...
5. (REP) Repsol Partners with Venezuela on Oil FieldSpain’s largest integrated oil and gas company, Repsol YPF, S.A. (REP), will pay Venezuela $203...
6. (UNT) – Unit Corporation – able to achieve a 21% increase in its total oil and natural gas productionUnit Corporation’s (UNT) share price recently reversed its downward slide, bouncing from a key level...

Search Posts by Tag: REP | Repsol YPF SA | Basic Materials | Major Integrated Oil & Gas

RSS Feeds by Tag: REP | Repsol YPF SA | Basic Materials | Major Integrated Oil & Gas |

Other Posts by: vitalstocks | RSS Feed for this author