Rick Perry Wants to Help Argentina be More Like Texas

(Bloomberg) -- The U.S. government is getting in on a shale boom 5,000 miles (8,000 kilometers) from home.

Energy Secretary Rick Perry will help Argentina connect with U.S. companies that have shale oil and gas expertise as President Mauricio Macri -- facing a natural gas trade deficit -- hurries to replicate the success of the Permian Basin, in Perry’s home state of Texas.

Fostering energy production from a regional ally will bolster the geopolitical influence of the U.S., Perry told reporters in Bariloche, Argentina.

“One of the things that I offered Juan Jose is U.S. technology partnerships, to make the introductions with the private sector,” Perry said, referring to Juan Jose Aranguren, Macri’s energy minister. “The technology that has allowed for the shale gas revolution in America we want to make available to Argentina.”

Perry is meeting Aranguren and other G20 counterparts in snow-covered Bariloche to discuss a global transition to cleaner energy -- especially gas. Argentina is ramping up production of the fuel in Vaca Muerta, the Patagonian shale play where Chevron Corp. and DowDuPont Inc. were among the first to get drilling going.

Argentina’s state-run YPF SA, the biggest operator in Vaca Muerta, sees the next phase of shale development driven by mid-cap independent companies lured from the Permian.

Now, Perry wants to add to that, bringing in U.S. pipeline developers to expand the play’s infrastructure and petrochemical companies to process the hydrocarbons once they’ve been moved out of the isolated shale fields.

Read more about the battle for a piece of Argentina’s petrochemical industry

Boosting output in Vaca Muerta, one of the world’s largest shale plays that remains largely untapped, will help the U.S. to direct geopolitics amid fractious relationships with major oil producers Russia and Venezuela, Perry said.

“Being able to not be held hostage by countries who don’t share our values is really important,” Perry said. “President Macri’s policies are right in line with U.S. values.”

Perry will advise Argentina -- already facing midstream bottlenecks as YPF and billionaire Paolo Rocca’s Tecpetrol SA spur gas production -- on avoiding pipeline capacity issues that have begun to plague the Permian, he said.

Transportadora de Gas del Sur SA recently announced it will build a $300 million gas pipeline in Vaca Muerta.

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