YPF

YPF S.A.
Company type	Majority state-owned
Industry	Energy (oil and gas)
Founded	June 3, 1922; 104 years ago in Argentina
Founder	Hipólito Yrigoyen (founder of the company as President of Argentina)
Headquarters	Buenos Aires, Argentina
Area served	Argentina
Key people	Enrique Mosconi (first director)
Products	Oil and gas exploration, production, transportation, refining, and sales
Owner	Argentine government (majority ownership)
Number of employees	Approx. 35,000 (circa late 1970s)

YPF S.A. (, previously known as Yacimientos Petrolíferos Fiscales; translated as "Fiscal Oilfields") is an Argentine energy corporation with majority state ownership, operating across the entire oil and gas value chain including exploration, production, transportation, refining, and sales. In the 2020 edition of the Forbes Global 2000, YPF was ranked as the 1360th largest publicly traded company globally.

Established in 1922 under the administration of President Hipólito Yrigoyen, YPF holds the distinction of being the first state-owned oil enterprise founded outside the Soviet Union, as well as the first to integrate vertically.

The company’s inaugural director, Enrique Mosconi, led from 1922 until 1930, advocating for economic sovereignty and the national control of oil resources—a mission obstructed by the military coup in 1930, which received support from foreign oil corporations.

During President Carlos Menem’s term, YPF underwent privatization and was subsequently acquired by the Spanish corporation Repsol in 1999, resulting in the creation of Repsol YPF.

In 2012, under President Cristina Fernández de Kirchner, a process began to renationalize 51% of YPF’s shares. Subsequently, the Argentine government consented to compensate Repsol with $5 billion.

Early development

YPF’s origins trace back to 1907 following the discovery of oil near Comodoro Rivadavia in Chubut. The strategic importance of oil surged after World War I, inciting competing nations to vie for control over these resources.

On June 3, 1922, Argentine President Hipólito Yrigoyen founded YPF as the world’s first entirely state-operated oil company. This preceded other national oil enterprises such as ANCAP (1931), YPFB (1936), Pemex (1938), ENAP (1950), and Petrobras (1953). General Enrique Mosconi was appointed as its first director.

In 1923, YPF acquired its initial tanker vessel from the United States and established extraction facilities along with entire communities including Comodoro Rivadavia, Caleta Olivia, Plaza Huincul, and General Mosconi. Within its inaugural year, YPF produced 2.2 million barrels—accounting for more than three-quarters of Argentina’s total output and nearly one-quarter of domestic consumption. Agreements with Bethlehem Steel facilitated production of gasoline and kerosene.

Mosconi proposed exploiting oil reserves in Salta by offering a 13% royalty to the provincial government; however, local authorities allied with Standard Oil rejected this under claims of "provincial autonomy." This rejection motivated Mosconi to advocate for full nationalization to ensure Argentina’s energy independence.

In December 1925, YPF launched its first refinery located in La Plata, which ranked as the tenth largest refinery worldwide at that time. This expansion met opposition from foreign oil conglomerates, notably Standard Oil, which wielded significant influence within Argentina.

By 1928, legislation passed by the Argentine Chamber of Deputies established a state monopoly over oil exploration, production, and transportation—excluding sales and imports. Private companies resisted the mandated 10% royalty fee. Although supported by President Marcelo Torcuato de Alvear, this bill was ultimately blocked by the Senate.

Nationalization of oil was a key issue in Yrigoyen’s 1928 electoral platform, aiming at curbing Standard Oil’s dominance while avoiding direct conflict with British firms such as Royal Dutch Shell.

Following Yrigoyen’s electoral success in 1928, YPF reduced oil prices in May 1929 to among the lowest internationally—stimulating sales growth and compelling competitors to lower their prices. Prices for kerosene and agrochemicals were also decreased to encourage regional economic development. By that year, YPF’s output reached 5.5 million barrels; however, its market share dropped to 58% due to expansion by Esso and Shell. A collaboration with Auger & Co. resulted in over 700 service stations retailing 178 million liters by 1930—holding an 18% market share—with revenues totaling US$25 million.

The Petroleum Institute (Instituto del Petróleo) was founded on December 30, 1929 under University of Buenos Aires rector Ricardo Rojas. Anticipating disputes with American corporations, Mosconi negotiated an agreement with Soviet company Amtorg for annual petroleum imports compensated through Argentine exports.

Plans aimed at full nationalization of oil were interrupted following Yrigoyen’s removal from office in September 1930 by a military coup led by General José Félix Uriburu.

Energy independence

The 1930 coup, driven in part by Standard Oil’s conflicting stakes in Salta Province and Bolivia, initially posed a challenge to YPF. Nevertheless, the subsequent Concordance government strengthened YPF’s position as the primary retailer of oil distillates through a 1936 agreement with the Automóvil Club Argentino (ACA), securing supply for ACA-operated service stations. YPF’s oil output expanded markedly, overtaking private sector production—from just above 5 million barrels (37% of the country’s total) in 1934 to 15 million barrels (67%) by 1945. Argentina’s natural gas development also largely stemmed from YPF-led initiatives. Under director Julio Canessa, President Juan Perón mandated capturing and commercializing gas flared during oil extraction, resulting in the creation of Gas del Estado ("State Gas") in 1946. By 1949, the nation completed its first gas compressor and what was then the longest gas pipeline worldwide, increasing natural gas production fiftyfold. By 1955, YPF’s oil production surpassed 25 million barrels, accounting for 84% of national output.

Despite these advances, private sector production dropped by 40%, causing total oil output during Perón’s tenure to rise by only one-third while consumption nearly doubled to 70 million barrels annually. This shift led Argentina from covering 60% of its oil needs domestically in 1945 to relying on imports for 60% by 1954, with import costs reaching US$300 million in 1955—over a quarter of merchandise import expenditures. Perón’s economic nationalism exempted YPF from high import tariffs levied on private companies, and Article 40 of the 1949 Constitution required nationalization of energy and mineral resources. To mitigate the growing trade deficit, Perón pursued foreign investment early on; a 1947 drilling agreement with U.S. firm Drilexco doubled exploration activity and uncovered significant reserves in Salta Province. A contentious joint venture with Standard Oil of California was signed in 1955 with plans for up to 56 million barrels annually but encountered opposition from the military, opposition parties, and YPF executives; it was terminated following Perón’s ousting that September.

President Arturo Frondizi, initially critical of these accords, introduced policies in 1958 that granted foreign companies rental contracts over new wells to boost exploration and production as part of his developmentalist program. These contracts guaranteed resource renationalization while allowing contractors to retain 40% of revenues from new wells. Thirteen agreements primarily with U.S. firms revived private sector production—which had nearly vanished—raising it to one-third of national output. YPF earned royalties that funded unprecedented investments, doubling its output to 65 million barrels by 1962; overall national production nearly tripled to 98 million barrels, cutting imports to one-sixth despite rising demand.

Known as the "oil battle" by Frondizi, these contracts were revoked by President Arturo Illia in 1963 amid concerns about YPF’s financial returns; only Amoco remained among foreign partners. The cancellations incurred US$50 million in compensation but preceded YPF’s discovery of the Puesto Hernández field near Rincón de los Sauces, Neuquén Province, later dubbed the "national energy capital" due to holding approximately half of Argentina’s oil and gas reserves at that time. This find propelled YPF’s output up by 50% between 1965 and 1968 to 95 million barrels, increasing its share from two-thirds to three-fourths of total production. Subsequent rental contracts followed a 1967 policy under President Juan Carlos Onganía targeting oil self-sufficiency by 1975. Regaining its exclusive right over oil imports in 1971 (averaging around 15 million barrels), YPF controlled three-quarters of production and more than half of refining and distribution by 1977, operating seven refineries and nearly 3,000 service stations with total output reaching 118 million barrels.

Decline and privatization

When Perón resumed the presidency in 1973, YPF's employee count expanded by nearly 20,000, reaching approximately 53,000 workers by 1976. This timeframe overlapped with the 1973 oil shock, which increased Argentina's oil import expenses by US$470 million and wiped out profits in 1974 amid a modest drop in production. The military dictatorship established after the 1976 coup initially boosted YPF’s output by 20% and reduced its workforce to around 35,000 by 1979 through significant layoffs.

Nevertheless, the military regime viewed YPF’s dominant role in the energy sector with suspicion. From 1975 onward, the company consistently operated at a loss, accumulating debts amounting to US$4.1 billion by 1981. These financial difficulties were largely due to government-imposed oil prices that lagged behind inflation, heavy taxation consuming 68.4% of revenues, and delayed payments from other state-controlled entities such as Argentine Railways and the national airline, which owed YPF fuel payments dating back up to a decade. This approach effectively treated YPF as a fiscal tool to help bridge Argentina’s persistent budget deficits.

After the accidental death of director Raúl Ondarts in a helicopter crash, General Guillermo Suárez Mason assumed leadership in 1981, ushering in a period marked by grave mismanagement. Suárez Mason installed rigid Army Intelligence personnel who exploited YPF assets through a front company called Sol Petróleo, engaging in embezzlement and channeling funds to groups such as the Contras and the clandestine organization P2. During his administration, YPF’s debt expanded dramatically—by a factor of 142—as it borrowed extensively to cover losses and support Economy Minister José Alfredo Martínez de Hoz’s deregulation initiatives. By 1983, YPF had posted a staggering US$6 billion loss, making it the largest corporate deficit globally at that time.

Despite these financial setbacks, YPF remained ranked as the world’s 365th largest corporation with sales exceeding US$4 billion by 1992. Under President Carlos Menem, YPF began privatization efforts through a US$3 billion initial public offering on New York and other stock exchanges in June 1993, selling a 45% stake. Prior to this move, CEO José Estenssoro spearheaded a comprehensive restructuring that cut the workforce from 52,000 to just 10,600 through layoffs and outsourcing strategies. The company’s financial situation improved markedly—from nearly US$1 billion in losses in 1991 to a US$1 billion profit in 1993—raising its market value from US$2 billion before privatization to US$9 billion afterward.

Estenssoro continued optimizing operations and pursued international expansion by acquiring Maxus Energy Corporation of Dallas for US$740 million in 1995. After his untimely death in a plane crash that same year, his successor Nells León maintained aggressive exploration spending, boosting reserves by half and increasing production from 109 million barrels in 1993 to an all-time high of 190 million barrels by 1998—32 million barrels of which originated from Maxus's overseas activities.

Repsol acquisition

In 1999, Madrid-based multinational Repsol took control of 98% of YPF through a two-step process: initially purchasing a 15% stake from the Argentine government for US$2 billion, followed by acquiring an additional 83%—including remaining public shares and most outstanding investor holdings—for over US$13 billion. The combined company was renamed Repsol YPF; YPF contributed roughly 40% of the group’s reserves and accounted for more than half of its production.

The Petersen Group, controlled by the Eskenazi family, joined forces with Repsol in 2007 by acquiring a 15% interest in YPF and later increased its holding to 25% in 2011 for US$1.3 billion. Repsol retained majority ownership with a 58% share; private investors held about 16%, while the Argentine Government maintained the golden share. In 2014, Repsol withdrew from Argentina entirely, divesting its stake in YPF.

Renationalization

By 2011, Argentina's energy sector was experiencing a trade deficit of approximately US$3 billion, which heightened tensions between YPF and the government. YPF's exploration investments were notably lower compared to other Repsol subsidiaries, a situation analysts and Repsol attributed to government-imposed export restrictions, limitations on prospecting leases, and domestic price controls. These political uncertainties also discouraged foreign capital inflows into Latin America's oil industry.

President Cristina Fernández de Kirchner pointed to insufficient investment and excessive dividend payouts as key factors behind the decline in production. Additionally, six provinces that produce fossil fuels revoked YPF leases accounting for about 20% of its oil output. On 16 April 2012, the government proposed legislation to renationalize YPF, whereby the national government would obtain a majority 51% ownership, while ten provinces would hold the remaining 49%. Julio de Vido, the Planning Minister, was designated to oversee federal intervention, replacing then-CEO Sebastián Eskenazi.

The move was met with strong opposition from Repsol and Spanish authorities, who accused Argentina of manipulating share prices ahead of the announcement. Economy Minister Hernán Lorenzino responded by alleging that YPF’s asset divestments had funded Repsol’s international expansion efforts. Spain reacted with diplomatic pressure and threats; concurrently, Sinopec, China’s state-owned oil firm, suspended its potential acquisition of Repsol’s stake following the renationalization declaration.

Stock prices for both companies plunged sharply; meanwhile, the cost of insuring Argentine government bonds against default increased alongside Spain’s financial risk indicators. Repsol estimated its losses at €5.7 billion (equivalent to US$7.5 billion). The Petersen Group had initially financed its acquisition through a vendor loan from Repsol; a 2008 contract required Repsol to repurchase shares if it lost majority control, but Petersen indicated it would relinquish this right.

The Argentine Senate overwhelmingly approved the takeover on 26 April, followed by the Chamber of Deputies on 4 May. President Fernández enacted the law on 5 May. Miguel Galluccio, an Argentine petroleum engineer with prior experience at both YPF and Schlumberger, was appointed as CEO.

Deputy Economy Minister Axel Kicillof dismissed Repsol’s initial compensation claim of US$10.5 billion for a 57% stake—while the government sought only 51%—citing nearly US$9 billion in outstanding debts. At the end of 2011, YPF’s book value stood at US$4.4 billion; its market capitalization was US$10.4 billion at the time of the announcement. Repsol pursued arbitration through the World Bank’s ICSID tribunal. In November 2013, Argentina and Repsol reached a settlement on compensation; by February 2014, Argentina agreed to pay US$5 billion in government bonds for the nationalized shares.

Following renationalization, YPF gained majority ownership of Metrogas—the largest gas distributor in Argentina—in November 2012. In July 2013, YPF entered into a joint venture with Chevron focused on developing tight oil and shale gas resources at Vaca Muerta. Investment at YPF accelerated rapidly post-renationalization, primarily financed through internal resources, the Chevron partnership, and high-yield corporate bond issuances—some reaching US$1.5 billion per tranche by April 2015 amid strong investor demand.

In December 2019, newly elected President Alberto Fernández appointed Guillermo Nielsen as YPF president; Nielsen was succeeded by Pablo Gerardo González in January 2021.

Reprivatization initiatives

Following the 2023 election, President-elect Javier Milei revealed intentions to privatize YPF along with other government-owned enterprises.

Operations

YPF continues to be the foremost energy corporation in Argentina, managing 52% of the nation’s refining capacity through three refineries and operating a network of 1,600 service stations. In 2011, the company sold 12.15 billion liters (3.21 billion gallons) of gasoline and motor fuels, capturing 57% of the domestic market share.

Argentina's crude oil production reached its highest point in 1998 at 308 million barrels but declined to 209 million barrels by 2011. Similarly, natural gas output decreased from 52 billion cubic meters in 2004 to 45.5 billion cubic meters. Between 1998 and 2011, YPF experienced a 43% reduction in oil production and a 37% drop in natural gas output. The number of exploration wells drilled fell from 30 in 1998 to just 8 by 2010, during which time French company Total S.A. overtook YPF as Argentina’s leading drilling operator.

The company’s share of national production diminished to 34% for oil and 23% for natural gas, representing more than half of the country’s lost oil output and nearly all of the decline in natural gas production. However, following the renationalization of YPF, these downward trends were reversed, with significant growth in both profitability and capital expenditures. Oil production increased by 3.4% in 2013 and natural gas by 2.2%, followed by further rises of 8.7% and 12.5%, respectively, in 2014.

In November 2011, YPF announced the discovery of the Vaca Muerta unconventional hydrocarbon formation covering an area of approximately 8,071 km², with estimated recoverable reserves amounting to 22.8 billion barrels of oil equivalent and potential expansion up to around 30,000 km². Despite this major find, conventional crude oil and natural gas reserves (excluding shale) had declined by 60% and 67%, respectively, between 1999 and 2011.

YPF's corporate headquarters, known as the Repsol-YPF Tower, was designed by architect César Pelli and officially opened in 2008.

Company statistics

Year	Petroleum production (million barrels)	Natural gas production (billion cu ft)	Petroleum reserves (million barrels)	Natural gas reserves (billion cu ft)	New exploratory wells	Net revenue (million USD)	Net profits after tax (million USD)
1992	101	493	1029	10918	17	4094	271
1993–95	130	423	1136	8965	82	4445	693
1996–98	182	490	1458	9812	34	5854	758
1999–2001	173	606	1592	10472	13	7806	842
2002–04	154	631	1255	7923	11	5974	1455
2005–07	127	651	677	4739	14	8544	1527
2008–10	111	544	601	3805	7	10531	1219
2011	100	441	583	3695	n.a.	13795	1289

Notes: Figures represent three-year averages; production data from the period between 1995 and 2011 incorporates Maxus Energy and other international subsidiaries, which account for roughly one-fifth of YPF’s global totals. Exchange rates based on IMF data.

External links