On Tuesday, President Javier Milei’s administration declared the removal of duties on crude oil exports. Government officials have formalized a memorandum of understanding with Chubut Province aimed at progressing towards the removal of export duties on conventionally produced oil, a component of a broader strategy intended to stimulate investment and safeguard employment. Cabinet Chief Manuel Adorni, Economy Minister Luis Caputo, and Interior Minister Diego Santilli convened with Chubut Province Governor Ignacio Torres at the Economy Ministry to formalize a memorandum of understanding between the national government and the Patagonian province. The objective is to “preserve activity in the mature oil fields, provide predictability to investments, and safeguard jobs.” The meeting included the participation of Energy & Mining Secretary Daniel González and Carlos Ormachea, who leads the CEPH (Cámara de Exploración y Producción de Hidrocarburos) chamber representing the sector.
“This agreement to share efforts beginning with Chubut and extending progressively to the remaining oil-producing provinces was signed,” stated the Economy Ministry in a release. The national state has committed to adjusting the existing export duties regime, with a focus on advancing their removal from conventionally produced crude. The province, therefore, “ratifies and deepens its policies of accompaniment view, revision of royalties and the companies pledge themselves to maintaining production and the investment plans necessary to guarantee the continuity of activity.” The Economy Ministry states, “investments within this framework give priority to projects destined to increase the production of conventional fossil fuels, reactivating plants and wells in mature fields, increasing the operational efficiency and sustaining the levels of direct and indirect employment associated with the industry.”
Governor Torres characterized the removal of export duties as “a historic step which we firmly defend from the Agreement on Competitiveness on which we have been working together with the companies and trade unions of the sector. It signifies the third most significant investment in the Gulf of San Jorge basin, with an anticipated impact of US$370 million that will be directly reinvested into the industry,” he noted. The understanding delineates a framework of collaborative efforts among three participants: The National State commits to adjusting its export duties regime, focusing on the removal of export duties from conventionally produced crude oil. – Chubut Province: Will proceed with a reassessment of royalties. – Companies must sustain production and adhere to investment plans to ensure the continuity of operations.
The initiatives aim to stimulate projects that revitalize plants and wells in established oil fields, enhance production, and sustain employment levels. The government has indicated that this policy will be gradually expanded to include the other oil-producing provinces, consistent with the decision to alleviate the tax burden and encourage new investments.