Shell is considering a partial or full exit from its shale oil and gas operations in Argentina’s Vaca Muerta formation, according to three sources familiar with the matter.
The energy major has recently approached potential buyers to gauge interest in the assets, which are located in the Neuquén Basin and could be worth several billion dollars, although a final decision has not been made.
Shell, which entered Vaca Muerta in 2012, operates four majority-owned blocks and holds minority stakes in three others, producing about 15.6 million barrels from Argentina in 2024, its latest annual report shows.
A possible sale would mark a significant shift for one of the region’s earliest international investors, at a time when global producers are increasingly seeking new shale opportunities outside North America.
The move follows Shell’s broader strategy under CEO Wael Sawan to streamline its portfolio and divest non-core assets after its renewable energy push underperformed.
Shell has already exited Argentina’s LNG project and is exploring asset sales in other markets, including Syria and Canada, as part of its global restructuring.
Vaca Muerta is seen as one of the world’s most promising shale plays, holding the second-largest shale gas and fourth-largest shale oil resources, according to U.S. government data.
Despite rising output, development in the region faces challenges from high drilling costs, weak oil prices and infrastructure bottlenecks.
However, analysts say Shell’s assets could remain profitable even at Brent prices below $50 per barrel, making them attractive to potential buyers.
If completed, the sale would signal a major reallocation of capital by Shell as it prioritises efficiency and returns over geographic expansion.