Natural gas agreement with Apache
Buenos Aires, August 5, 2010
To: BUENOS AIRES STOCK EXCHANGE
ARGENTINE SECURITIES COMMISSION
Ref.: Relevant Event. Pampa Energía and Apache partner to develop unconventional gas fields
In my capacity as Responsible of Market Relations for Pampa Energía S.A. (“Pampa” or the “Company”), I am pleased to inform to the Argentine Securities Commission and to the Buenos Aires Stock Exchange that on the date hereof Pampa has, through its subsidiaries Petrolera Pampa S.A. and Central Térmica Loma de la Lata S.A., executed a letter of intent with Apache Energía Argentina S.R.L. (“Apache”) to jointly engage in the development and exploitation of unconventional gas repositories, and has also placed an irrevocable bid for the purchase of natural gas within the framework of the Gas Plus program launched by the Argentine Government.
The partnership with Apache would allow the production of an additional 700,000 m3/day of non conventional natural gas, from reservoirs with low permeability, at the Anticlinal Campamento and Estación Fernández Oro areas, in the provinces of Neuquén and Río Negro. Pampa would have a 15% participation in the necessary investments for the development of this gas production, estimated to be approximately US$8,000,000, allowing Pampa to obtain its proportional participation in the production. All of this additional production will be assigned to the supply of Central Térmica Loma de la Lata.
Simultaneously, we have signed an irrevocable bid for the acquisition of 800,000 m3/day of Gas Plus from Apache for a three year period, seeking also to ensure the gas supply required by Central Térmica Loma de la Lata. The agreed upon price for the Gas Plus, authorized by the Secretariat of Energy, is US$5.00/MMBtu.
In this manner, once the definitive investment terms are reached Pampa would be in a position to ensure approximately 60% of the provision of gas for Central Térmica Loma de la Lata.
These initiatives that we undertake together with Apache, aimed at ensuring the supply of gas for the Loma de la Lata thermal plant, come on top of the agreement executed between Pampa and YPF in November 2009 whereby Pampa agreed to invest up to US$29,000,000 in the Rincón del Mangrullo field in the province of Neuquén and that would allow Pampa to supply 11% of the consumption of Central Térmica Loma de la Lata.
Responsible of Market Relations