Continental Resources Makes Major Play in Argentina’s Vaca Muerta Shale
The global energy spotlight is shining brightly on Argentina, as U.S. shale giant Continental Resources announces a significant expansion of its footprint in the prolific Vaca Muerta formation. The move involves a strategic partnership with Pan American Energy (PAE), the country’s second-largest private oil company, to develop four critical shale oil blocks. This alliance underscores the South American region’s growing importance in the unconventional energy landscape and highlights the increasing industrial maturity of the Vaca Muerta basin.
Announced on Monday, the deal sees Continental Resources acquire a 20% non-operating stake in the four areas: Coirón Amargo Sureste, Bandurria Centro, and Aguada Cánepa in Neuquén province, plus Loma Guadalosa in Río Negro province. PAE will maintain its role as the majority partner and the operator of all blocks. The clear goal is to accelerate the development of the acreage by combining PAE’s deep operational knowledge of the local basin with Continental’s decades of specialized technical expertise in North American unconventional resource plays.
For Continental, which is recognized as a pioneer in U.S. shale regions like the Bakken and Permian and is the world’s largest privately held oil and gas producer, this transaction significantly builds on its recent entry into Argentina. The company’s President and CEO, Doug Lawler, called Vaca Muerta “one of the most compelling shale plays in the world,” emphasizing the excitement to continue investing in the region. Continental’s entry into the PAE blocks comes on the heels of its November 2025 agreement to acquire a majority operated interest in the nearby Los Toldos II Oeste block.
The deal arrives at a high-water mark for Argentina’s hydrocarbon sector. Driven largely by the performance of Vaca Muerta, the nation’s unconventional oil production has surged to record highs. As of late 2025, unconventional sources accounted for over two-thirds of Argentina’s total oil output, with total oil production reaching approximately 857,700 barrels per day in November 2025. This level of growth has been made possible by a dramatic improvement in operational efficiency, with well completion connections increasing by over 30% year-over-year, bringing the region’s technical sophistication closer to U.S. standards.
The timing is also a clear vote of confidence in Argentina’s current political and economic climate. To incentivize massive capital flow, the Argentine government has introduced the Large Investments Incentives Regime (RIGI), which offers legal and regulatory stability for up to 30 years for major projects. Furthermore, major infrastructure bottlenecks that once restricted growth are being addressed, with projects like the Oldelval pipeline expansion and the Vaca Muerta South Pipeline underway to boost crude oil takeaway capacity to export markets.
PAE’s CEO, Marcos Bulgheroni, noted that the partnership aims to “accelerate the development” of the areas, with Continental’s technical know-how in de-risking and operational efficiency being a key contribution toward unlocking the nation’s vast resources. With both major pipeline infrastructure expanding and a specialized foreign partner injecting world-class expertise, this strategic agreement is positioned to accelerate production from these four blocks, solidifying Argentina’s standing as a formidable player in the global energy market.
