“We supposed it was a unit of YPF, but it isn’t, it’s a separate company,” ruling party Senator Anibal Fernandez said on Wednesday in Buenos Aires. “Both companies need to be expropriated.”
Argentine President Cristina Fernandez seized control of YPF, the country’s largest energy company, on April 16, and sent a bill to nationalize the stake.
Argentina said Spanish parent Repsol YPF SA was responsible for declining Argentine oil and gas output since 1998. Senators will vote on the bill April 25 after Senate committees approved it on Wednesday.
“The draft bill is signed,” Senator Anibal Fernandez, told reporters at the upper house. This clears the way for a vote by the full Senate next week.
Argentine provinces withdrew 15 oil field licenses from YPF before this week’s nationalization announcement as the government demanded the Madrid-based oil producer increase output and investments as it seeks to cut back on fuel imports that doubled to 9.4 billion last year.
Argentina’s largest gas distributor is bankrupt Metrogas SA, in which YPF SA owns a stake. Metrogas, in which the UK’s BG Group Plc is the largest shareholder, is under government control since filing for bankruptcy in June 2010.
Gas, oil and utility prices regulated since at least 2002 as part of government’s anti-inflation policies have reduced investments and driven foreign companies such as GDF Suez to leave the country while others, such as BG, closed their local offices.
The YPF takeover, believed to be the biggest nationalization in the natural resources field since the seizure by Russia of the Yukos oil company a decade ago, is expected to be raised at this weekend's World Bank and International Monetary Fund meeting of finance chiefs.
Argentina's Economy Minister Hernan Lorenzino said he will be at the spring meeting in Washington to explain Argentina's position. Hours before heading to Washington DC Lorenzino assured that “in the current environment of financial turmoil, Argentina remains one of the region’s most important engines of economic growth sustained by the emerging economies.”
“Since 2003 onward, our country has experience a process of sustained development, with social inclusion and production diversification that not only stands out among some of the world’s most dynamic economies, but has also allowed the country to more easily circumvent the socio-economic consequences of the global recession and financial volatility,” he explained.
Lorenzino strongly disagreed with recent diagnostics and recommendations of economic policy issued by the IMF World Economic Outlook, and pointed out that “since Argentina recovered its political and financial autonomy and distanced itself from the IMF impositions, this organization has constantly underestimated our country’s GDP growth rate”.