Political Risk Latin America Blog @PolRiskLatam

Pan American Energy, –partly Chinese owned–, keeps expanding in Argentina

Posted in News and Articles, Political Risk by politicalrisklatam on February 22, 2011

by Merco Press News, February 22nd, 2011.

Argentina’s Pan American Energy will sign a deal later this month to buy Exxon Mobil local downstream unit Esso, turning the company into a fully integrated oil and gas producer. Pan American Energy is a unit of Bridas Corp., which is jointly owned by Argentina’s Bulgheroni family through Bridas Energy Holdings and China’s Cnooc Ltd.

The deal, between 800 million and 850 million US dollars will be signed Feb. 28 in London, according to a person close to the matter. Cnooc executives asked that the signing be delayed until after the end of Chinese New Year celebrations.

Esso is Argentina’s third-biggest fuels retailer after YPF and the local unit of Royal Dutch Shell. Esso operates a network of 450 service stations and an 85,000-barrel-a-day oil refinery.

Acquiring Esso’s retail and distribution business will allow Pan American to better compete with YPF, the country’s largest integrated oil company, analysts said. YPF controls more than 60% of the retail fuel market, compared with Esso’s 14%.

Esso has been operating in Argentina since 1911. Pan American already supplies most of Esso’s crude oil, making a merger of the two companies a good fit. (continue reading… )


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