Spain's Repsol will look into a non-cash offer over the expropriation of  its majority stake in energy firm YPF, a source said.

Repsol's board will study the non-cash compensation offer from Argentina made through Mexican shareholder Pemex. Pemex, which owns 9.2%  of Repsol, had acted as  intermediary in negotiations with YPF as it aimed to get a stake in Argentina's Vaca Muerta shale field.

In May 2012, the government of Argentina seized YPF on allegations of underinvestment by Repsol.  Repsol contested the legality of the expropriation by filing several legal claims.

The offer was reportedly worth $5 billion which included a 47 percent stake in a joint venture that will develop part of Vaca Muerta and Argentine bonds worth $1.5 billion.

However, it was way below Repsol's claim valued at $10.5 billion as the estimated book value for Repsol's 51% stake in YPF was Eur5.5 billion and a $9 billion for the stake as stated in the YPF's by-laws. 

"Although we welcome the potential intensification of talks with Argentina, we believe there is a low probability that Repsol would accept a deal that involves further investments in Argentina," Espirito Santo Investment Bank was quoted in a note.