The Vaca Muerta play, one of the world's largest shale oil and gas fields, has become a magnet for investment, drawing the interest of supermajors like Shell and ExxonMobil, and promising to help boost Argentina's future economic development.
The giant shale formation, which sprawls over 30,000 sq. kilometers (11,583 sq. miles) in four provinces, attracted $4 billion in investment in 2018, with the figure soaring to $7.49 billion this year.
The majority of the non-conventional Vaca Muerta play is in the southwestern province of Neuquen.
Vaca Muerta's potential first came to light in 2011, when YPF, the largest oil company based in Argentina and controlled by Spain's Repsol at the time, announced the discovery of large reserves in the formation.
The expropriation of Repsol's assets led to a drop in private investment, harming YPF. The trend did not turn around until 2015.
With interest among foreign investors rising, several projects went into the development phase last year despite the recession in Argentina.
A wave of project announcements followed. In May, Anglo-Dutch supermajor Shell said it would invest $3 billion over five years to develop three areas in Vaca Muerta that had previously only been exploration blocks.
Three weeks ago, US-based ExxonMobil said it would spend $2 billion over five years to develop an area located in the Neuquen basin.
About 30 companies currently have concessions in Vaca Muerta, with YPF, now controlled by the Argentine state, holding the largest number.
The oil industry's big players, however, are increasingly focusing on what is the world's second-largest non-conventional gas play and the fourth-largest petroleum play of this type.
These "major league players" have ambitious plans for Vaca Muerta, but it may take them several years to recoup their investments amid the always complicated political situation in Argentina.
"Argentina's energy potential is very big and both public and private (sector) actors realize that it's a great opportunity," Moody's analyst Martina Gallardo Barreyro, who follows the development of Vaca Muerta, told EFE.
In spite of the uncertainty surrounding the October presidential election, "the companies want to be here, they're not going to miss out," the analyst said.
Despite the investment boom, Vaca Muerta is far from being tapped out, with barely 5 percent of the shale play developed so far.
Vaca Muerta is slowly changing the energy map in Argentina, which started recovering five years ago after years of production drops, thanks to the gradual growth of non-conventional oil and gas output.
In addition, the development of Vaca Muerta is key for the growth of the economy in Argentina, which experienced energy shortages in recent years, especially in the natural gas sector, forcing the government to restrict consumption and import energy products, straining the budget.
Now, this petroleum "oasis" promises to make Argentina energy self-sufficient and generate foreign exchange from exports of surplus oil and gas.
In 2018, according to Argentine Energy Institute figures, exports of fuel and other energy products totaled $4.19 billion, up 69.2 percent on a year-on-year basis, while imports of fuel and lubricants totaled $6.52 billion, up just 14.1 percent, resulting in a deficit of $2.33 billion, a figure that was down 27.9 percent from the 2017 deficit.
"Last year, we had a deficit in the balance of trade for energy products of $2.3 billion and this year we're on track to balance it out. In the first four months, in fact, we had a small surplus," Energy Secretary Gustavo Lopetegui said during a business workshop on Vaca Muerta held two weeks ago in Neuquen.
A recent study, using conservative estimates, by the Rosario Commodity Exchange found that Argentina's hydrocarbon exports could reach $8.2 billion in 2023, a figure that would be nearly one-third of the powerhouse agro-industrial industry's current exports of $25 billion.
If, however, Argentina pursues an aggressive investment policy in Vaca Muerta, hydrocarbon exports could reach $25.4 billion in 2030.