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Argentina-focused Vista raises $107m in share offering

Vista Oil & Gas has raised US$107 million in a primary public share offering aimed at funding shale drilling work in Argentina, where it has set ambitious targets.

The Mexico-based company said on July 26 it had raised 2.03 billion pesos (US$107 million) after it placed 11.5 million shares simultaneously on the Mexican and New York stock exchanges. The shares were priced at 176.6 pesos (US$9.25) each with the offering co-ordinated by Citigroup and Credit Suisse.

The share offering comes two years after Vista, which is backed by New York-based private equity company Riverstone Capital, held an IPO in the US and Mexico that raised US$650 million through the sale of 65 million shares at a US$10 per unit.

The latest fundraising will support the company’s rapid ramp up of drilling work in the Vaca Meurta shale in Argentina. Vista announced in April it had produced a higher-than-anticipated 6,500 boepd from its first drilling pad in the Vaca Muerta. The four-well pad is on the Bajada de Palo Oeste block in the oil window of the shale play.

Vista entered the Vaca Muerta in 2018 under the guidance of its CEO Miguel Galuccio, who was previously head of Argentina’s state-run YPF and spearheaded the opening up of the shale play to development.

Galuccio said earlier this year that the results at Bajada de Palo Oeste meant his company was on target to achieve total output of 65,000 boepd in 2022. Vista currently produces around 29,000 boepd, with most of its output coming from assets the firm acquired in Argentina and a small amount from fields in Mexico.

Argentina remains the company’s core focus, however, with plans to invest over US$2 billion in drilling more than 150 wells in the Vaca Muerta shale over the next five years.

The company also intends to finance some of the investment out of cash flow from assets with conventional reserves it acquired last year for US$360 million from Pampa Energy, a leading player in Argentina.

The acquisition made Vista the fifth-biggest oil producer in the country and provided it with a sizeable footprint in the Vaca Muerta. The company now controls 137,000 acres (554 square km), of which 54,000 acres (219 square km) are ready for development in the oil window of the play.

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