Spain warns Argentina over Repsol energy dispute

AP News
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Posted: Apr 12, 2012 1:11 PM
Spain warns Argentina over Repsol energy dispute

A senior Spanish official warned Thursday that the government will interpret any "hostile gestures" against Spanish companies abroad as an act of aggression _ in an apparent reference to a conflict with Argentina over an oil company controlled by Spain's Repsol.

YPF _ 57 per cent owned by Repsol _ has rejected Argentine government pressure to plow some of its profits back into the South American country. The Argentine government has accused the company _ which is the country's largest and vital for its energy future _ of paying too much of its profits in dividends and not investing enough in exploration and production.

"If anywhere in the world there are hostile gestures against the interests of Spanish companies, the government will regard them as hostility against Spain," Spanish Industry Minister Jose Manuel Soria said.

"What the Spanish government is saying is that if there are any hostile gestures, they will bring consequences," Soria said. He did not elaborate.

YPF has resisted the Argentine government's pressure, offering to recapitalize its gains rather than create a separate fund to develop new energy resources.

In recent developments, several Argentine provinces have revoked YPF licenses in areas that the company had yet to fully develop.

Argentine Cabinet chief Juan Manuel Abal Medina said last month that "if the only way forward is to nationalize YPF, it will be nationalized."

YPF represents 42 percent of Repsol's total reserves, estimated at 2.1 billion barrels of crude.

Argentina's Petersen group owns 25 percent of YPF.