December 18, 2017
Thursday, July 17, 2014

Gov’t claims holdouts are after Vaca Muerta

YPF CEO Miguel Galuccio (right) is seen signing an agreement last year with Chevron representative Ali Moshiri.

Mujica, think tanks talk about ‘extortion,’ agree shale formation is under threat

President Cristina Fernández de Kirchner warned yesterday that the holdout hedge funds she refers to as “vultures” could be eyeing up Argentina’s vast Patagonian shale oil and gas reserves as collateral in the struggle for repayment outside the debt swaps of 2005 and 2010.

Speaking at the VI Summit of BRICS nations plus Unasur in Fortaleza, the head of state made reference to an article by a US Republican, economist Bernard Weinstein, which defended the hedge funds led by Paul Singer’s NML Capital and warned that “Chevron could withdraw” from Argentina if a settlement is not reached.

The country technically has until the end of July to agree compensation with the holders of defaulted debt, as per the order of US District Judge Thomas Griesa.

“Do you really think this is a judicial issue regarding US$1.5 billion, or that (they) pretend to collapse Argentina’s debt swaps, for which we have already paid US$190 billion,” the president contended.

Fernández de Kirchner said “Argentina has the second largest shale gas reserve and the fourth (largest shale) oil (reserve) in the world, which would make us self-sufficient and capable of exporting energy by 2017 or 2018.”

Weinstein “referred to two important members of the G20 offensively and makes reference to Chevron in Vaca Muerta, threatening that it would withdraw if nothing is arranged,” she continued.

“Chevron is likely to have second thoughts about its commitment to the Vaca Muerta project and other foreign investors are likely to either wait on the sidelines or demand more favourable terms for participation,” Weinstein’s article read.

Widespread support

Uruguayan President José Mujica agreed: “I’ve already said it, they want to take a bite out of Vaca Muerta from Argentina.”

“If they mistreat Argentina, they can mistreat anyone,” the head of state from across the River Plate argued.

According to Télam, Weinstein, a member of the George W Bush Institute, is financed by the American Task Force Argentina (ATFA). In his article, published in Investor’s Business Daily, he argues that Argentina risks “importing fuel forever” unless it settles with the holdouts.

Support for the government regarding the exposure of Vaca Muerta also came from the Observatory of Energy, Technology and Infrastructure for Development (OETEC), whose director called for a debate on how to shield the formation from ongoing “financial terrorism and international financial speculator.”

“The campaign by ATFA and its lobbyists against our country has been growing around the world,” he said, adding the “vultures are hedging their bets on economic and political extortion to take Vaca Muerta from us.”

“Before this new affront, it would be necessary to discuss how we can defend Vaca Muerta as a people and as a society, with all political forces (taking part), which would be nothing other than defending our national security,” he concluded.

Economists from the government-aligned think tank La Gran MaKro also voiced their support.

“This is nothing new, but now it’s being outlined more organically, with (explicit) statements from the lobbyist, Bernard Weinstein, regarding Vaca Muerta,” said Fernanda Vallejos, emphasizing, however, that claims to obstruct foreign investment by such entities have are abundant, “and none have prospered.”

Her colleague, Agustín D’Attellis, agreed: “The vulture funds are going after Vaca Muerta, and they’re doing so with the pretence of scaring (investors) with the possibility of a technical default.”

Herald with Télam

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