Vista Energy, S.A.B. de C.V. (“Vista”) (VISTA) announced that its wholly-owned subsidiary Vista Energy Argentina S.A.U. has established an un-incorporated joint venture and has entered into an investment agreement
(“Agreement”) with Trafigura Argentina S.A. (“Trafigura”), for the joint development of 3 pads in Bajada
del Palo Oeste.
Under the terms of the Agreement, which is effective as of October 1, 2022:
a) Trafigura (A) has a contractual right over 25% of the hydrocarbon production of the pads
included in the Agreement, (B) bears 25% of the capital expenditures, as well as the
corresponding royalties and direct taxes, with respect to the pads included in the Agreement,
and (C) will pay Vista: (i) US$1,700,000 for each tied-in well (equivalent to US$6,800,000 for a
4-well pad), (ii) a fee, capped at 12.5 $/bbl, over Trafigura’s share of total production to
compensate Vista for any improvements in international crude oil prices above 60 $/bbl and
up to 110 $/bbl, and (iii) a fee on Trafigura’s share of total production to compensate Vista for
all operating expenses, G&A expenses, midstream costs within the block and well
abandonment costs.
b) Vista remains operator of the block and 100% title holder of the Bajada del Palo Oeste
concession. With respect to the pads included in the Agreement, Vista: (i) retains its rights over
75% of the hydrocarbon production, (ii) bears 75% of the capital expenditures, as well as the
corresponding royalties and direct taxes, and (iii) bears all other costs, including operating and
midstream costs within the block.
In conjunction with the Agreement, Vista and Trafigura have extended by 12 months the previous crude
oil sales and purchase agreement, pursuant to which Vista shall sell to Trafigura 380,000 barrels of
crude oil per month during the first semester of 2023 and 345,000 barrels of crude oil per month during
the second semester of 2023, at a purchase price to be agreed by the parties according to market price
and conditions.
This Agreement allows Vista to increase its free cash flow generation beyond the objectives laid out by
Vista in its 2022-2026 strategic plan, contributing to: (i) further reduce gross debt, (ii) distribute capital
to shareholders through share buy-backs or dividends, and (iii) accelerate investment in Vaca Muerta,
in particular in midstream infrastructure projects, to generate profitable growth driven by the export
market. Additionally, the Agreement allows the Company to further consolidate its relationship with
Trafigura as a strategic partner.
