Yacimientos Petrolíferos Fiscales (YPF): History and legacy

• Published date: 01 February 2019
• Date: 01 February 2019
• DOI: http://doi.org/10.1002/pa.1906

ACADEMIC PAPER

Yacimientos Petrolíferos Fiscales (YPF): History and legacy

Gonzalo Ariel Viña

1

|Pablo Ferrara

2

1

Estudio Beccar Varela, Ciudad Autonoma de

Buenos Aires, Argentina

2

Argentine Ministry of Energy, Ciudad

Autonoma de Buenos Aires, Argentina

Correspondence

Pablo Ferrara, Argentine Ministry of Energy,

Av. Paseo Colon 171, Ciudad Autonoma de

Buenos Aires, Argentina.

Email: pferrara@minem.gob.ar

This paper aims at providing an overview of Argentine National Oil Company (NOC)

“Yacimientos Petrolíferos Fiscales”(YPF) role in Argentina's energy policy. In order

to do it, the work takes off from NOCs roles vis‐à‐vis private oil and gas corporations,

moving to YPF's history, and its energy socioeconomic effects.

1|INTRODUCTION

It is quite a task to summarize the history of a company such as

“Yacimientos Petrolíferos Fiscales”(“YPF”) in a few pages, especially

when said enterprise is approaching its hundredth anniversary,

preexisting even several provinces in Argentina. However, we have

addressed this endeavor to provide an overview of YPF and how it

is linked to the progress and setbacks of Argentina. In addition, we

inform the reader that this paper lacks any assessments regarding reg-

ulations, policies, and/or ideologies, as we have sought to objectively

reflect the facts described herein.

2|OIL AND GAS CORPORATIONS

2.1 |Public and private corporations

In the hydrocarbon industry, there is a difference between compa-

nies whose ownership and decision making belong to the public

and those that belong to the private sector. On this basis, we draw

a distinction between international or private oil companies and

state or national oil companies, referred to as “IOC”(International

Oil Company) or “POC”(Private Oil Company) and “NOC”(National

Oil Company). Although IOCs are under the direction of individuals,

NOCs are corporations that have a national government as their

main shareholder or owner. The distinction lies in whether the public

sector has sufficient power to take control of the decision‐making

process, considering the public interest while doing so. There is no

doubt that the outlook of a private shareholder—whose concern is

to maximize its investment—will drastically differ from a national

government, which must principally address collective, political, or

social interests.

NOCs are far more than just corporations which pursue profit:

They are state flagships that enhance and promote national pride.

Therefore, political involvement in their structure is inevitable and

sometimes leads to the presence of the same red tape procedures that

coexist in any government structure.

1

In the same way, when incorporating a government as an element,

these corporations are likely to present disparities between business

interests and those pursued by the State on political matters.

2

In that

sense, the corporate structure, which defines the level of state

intervention, usually consists of an autonomous entity that will

ultimately be subjected to public audit. The rationale for such

consequence comes from the public financial resources provided by

the government.

In this respect, there are three alternatives to the origin of assets

when NOCs are incorporated: (a) Assets may be provided by the

government; (b) assets that preceded an IOC and then were

transferred to the NOC; and (c) contributions of equity provided by

the government.

3

We must bear in mind that access to financial resources could be

extremely burdensome for a new state‐owned corporation, and that is

the reason why it depends on such public funds. However, it is neces-

sary to balance the factors in a way that the presence of the public

interest does not transform the NOC into a deficit corporation.

In the subsequent chapter, we will briefly review the activity of

well‐known NOCs to demonstrate their contribution to the hydrocar-

bon industry.

1

LOSMAN, Donald L. (Losman, 2010). “The rentier state and national oil compa-

nies: An economic and political perspective.”Middle East Journal, Vol. 64, N° 3,

435, 427–445.

2

KHAN, Kameel (Khan, 1985). “Some legal considerations on the role and struc-

ture of state oil companies: A comparative view.”The International and Compar-

ative Law Quarterly, Vol. 34, No. 3. 584–592.

3

KHAN (Khan, 1985).

Received: 15 October 2018 Accepted: 16 November 2018

DOI: 10.1002/pa.1906

J Public Affairs. 2019;19:e1906.

https://doi.org/10.1002/pa.1906

© 2018 John Wiley & Sons, Ltd.wileyonlinelibrary.com/journal/pa 1of10