Argentina president-elect picks Horacio Marín to run YPF in run-up to selling state shares

Argentinian President-elect Javier Milei said Nov. 24 he appointed Horacio Marín as head of YPF, bringing to the state-controlled energy company a veteran in exploration and production activities.

Marín will take office with the new administration on Dec. 10, the incoming government said in a brief statement.

Marín will come to YPF, the country's biggest oil and natural gas producer, after 35 years at Tecpetrol, the third-biggest gas producer in the country, where he has been president of exploration and production for the past year. Most of his work at the company has been in that field and in the management of reserves, both in Argentina and Venezuela.

Tecpetrol, a unit of the Argentinian-Italian industrial conglomerate Techint, has been stepping up its investment in Vaca Muerta, the country's biggest shale play. A more than $2 billion investment in the Fortín de Piedra block has catapulted it to the second-biggest gas producer in Argentina. The company has said it is expanding into oil in Vaca Muerta, where it now sees more potential for growth thanks to the greater availability of takeaway capacity and export potential.

The incoming government did not mention what specific role Marín will hold, leading to speculation in the local press that he could run the company as both chairman and CEO.

A source at YPF told S&P Global Commodity Insights that he did not have information on Marín's exact position, adding that a dual role would require changing the company statute. The statute says that the board of directors appoints the CEO, and it also bars the chairman from holding the top post in management, the source said.

Next step: privatization

Marín comes to YPF as the incoming administration prepares to sell off its 51% stake in the company to the private sector.

"Everything that can be in the hands of the private sector will be in the hands of the private sector," Milei said Nov. 20 on radio.

Milei said at the time that the first step will be to rebuild the market value of YPF to make it more attractive for potential buyers.

"Obviously the first thing to do is put it back together," he said then, adding that this way it "can be sold in a very beneficial manner for Argentines."

YPF was sold to private investors in the 1990s, but 51% was bought back by the state in 2012 in a bungled expropriation that has left Argentina with a court order to pay some of the former shareholders $16 billion in compensation.

While YPF has rebuilt its oil and gas production, along with many other producers in the country, Milei said its financial results are lower than before the re-nationalization.

YPF is the biggest oil and gas producer in Argentina, producing nearly 50% of the country's 645,000 b/d of oil and 24% of its 140 million cu m/d of gas.

YPF also is the leader in Vaca Muerta, a huge shale play driving production growth. Milei's team has said that the next steps will be to increase takeaway capacity from Vaca Muerta, build export terminals for oil and gas, and develop potentially other shale plays. He has cited the promise of huge resources off the coast of Buenos Aires, with expectations to produce 200,000 b/d or even 250,000 b/d.