Repsol pushes for a convincing compensation amount to expropriate its holding in YPF
On Tuesday, Repsol Chairman Antonio Brufau reportedly asked the Argentinian government to offer a convincing amount for the former to expropriate its majority stake in YPF, an energy firm. Last week, Reuters noted that both parties had come to an initial agreement regarding compensation for the seizure of Repsol's ownership stake in YPF last year. Sources said Repsol's stake was worth USD5 billion, which was half the amount the oil firm is requesting initially.
The expropriation process is described as when a public agency like a state government takes over a private property or interest from a private company. The purpose of the takeover is credited to the public interest. The term is also used to describe nationalization done by communist states.
At a business event in Barcelona, Brufau said, "We've never mentioned $5 billion. What we've said is that the sum received should be, in some way, convincing and justify the withdrawal of lawsuits." The event was the first public of Brufau since last week.
The compensation would reportedly also cover Repsol's agreement to withdraw a collection of lawsuits filed against the Argentinian state regarding the seizure of the YPF stake. The compensation in the initial agreement, Reuters said, was in the form of liquid assets. The details of the agreement was expected to be fixed in the next few weeks, of which the compensation would be in the form of 10-yea US dollar-denominated Argentine bonds.
In June, Repsol rejected a compensation offer for the YPF stake. The compensation offer, the news agency said, included investments and an ownership interest in the vast shale oil and gas field in Vaca Muerta, which is located in Argentina.
Earlier, Spanish commerce secretary Jaime Garcia-Legaz said to the news agency that any deal that will occur between the two entities was preferred instead of a lawsuit. In an interview with newspaper Expansion that was published on Tuesday, Garcia-Legaz said, "A deal, whether good, bad or average is always better than a lawsuit."