Vista Oil, Trafigura to develop oil wells in Argentina - Reuters

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Trafigura logo is pictured in the company entrance in Geneva March 11, 2012. REUTERS/Denis Balibouse/File Photo

BUENOS AIRES, June 28 (Reuters) - Latin American oil company Vista Oil & Gas (VISTAA.MX) and Geneva-based Trafigura (TRAFGF.UL) on Monday signed a deal to jointly develop 20 wells in Argentina's Vaca Muerta shale oil deposit, the companies said in a statement.

The investment will be made in the Bajada del Palo block Oeste, where Vista already has 28 operational oil wells, the statement said.

Trafigura Argentina will invest around $75 million. Of that, $50 million will be used to develop the new wells and $25 million will be used to buy 20% of their eventual production, it added.

Vista will continue to own the entire concession and operate the wells, paying 80% of the upfront development costs and keeping 80% of their production.

The agreement "will contribute to generating more production, and thus continue to expand energy exports essential for bringing in the foreign exchange that Argentina needs, while continuing to supply the local market," Vista CEO Miguel Galuccio said in the statement.

Trafigura, which sells more than 6 million barrels of oil per day, owns the Bahia Blanca Refinery in Argentina and Puma Energy, a network of more than 350 service stations.

Martin Urdapilleta, the company's local general manager, said the deal represented a strengthening of their business and supply in local and export markets in neighboring countries.

Reporting by Eliana Raszewski; writing by Aislinn Laing; Editing by Cynthia Osterman

Our Standards: The Thomson Reuters Trust Principles.

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