The news restrictions to the availability of Dollars for the payment of debts are just one more link in the contradictory signals in the energy sector in the last two months. Publicly, there are almost no distinctions in the main references of the national government when choosing the place from which the dollars could begin to be found. However, in fact, the differences seem to be endless and rather go in the opposite direction.
Big companies with both feet on Dead cow they see in the new scenario a very bad sign, rather than a concrete effect on their operations. Why? The billions of dollars that they contributed until mid-2019, a moment that could be taken as the beginning of the current cycle of decline in the oil sector, usually comes from the flow of money from their parent companies. Given the inquiries made by + e about the Argentine economic scenario since this week, a group of the largest explained off the record that in fact they have not had problems to send remittances abroad.
They consider that the worst thing is how a bad climate is generated to attract investment. This, in the case of the “large” companies, those whose capital comes from the cash flow of their businesses around the world, who had taken the option of investing in Vaca Muerta at a rate of between 3,000 and 5,000 million dollars annually in the last triennium.
But the new restrictions on access to dollars for those who have debts to refinance add an additional share of uncertainty. The situation picture can become very different for dozens of SMEs that have assumed debts in dollars, whose payments must now refinance and adapt to the restrictions imposed by the BCRA to prevent the great drain on dollars.
In YPF they affirm that the company has already refinanced a good part of its debt in dollars. However, it has commitments to assume in which it might need to readjust these returns to the new provisions, or make payments with its own cash, something that it would prefer to use to incentivize the production that the country will need in the coming months.
According to what the BCRA defined, it will only be able to take something like 40% of the dollars it needs in the local market and the rest to try to refinance it, if it opts for that definition.
However, there is another concern that transcends economics in the oil industry and is the incongruous series of uncertainties, more related to politics than to the current cycle of economic crisis.
The Gas 4 Plan, that project closely linked to the level of reserves in dollars for the country, now in the process of readjustment; the declaration of Metrogas, the country’s main distributor, that it will not pay a whopping 7.5 billion pesos to large producers; the brake on millionaire payments that arise from the non-validation of decree 1053/2019, which established payments for the devaluation of the currency and its impact on the gas rate during the macrismo, are a difficult cocktail to overcome when generating stable conditions for the national government to find in Vaca Muerta the answers that it says it will seek.
The Secretary of Energy, Darío Martínez, has been talking with the main operators in the country, but his lack of appointment to the position, 15 days after the public news, also give a bad signal in the oil sector in a context without certainty and with one of the quickest sands in memory. In this context, the lack of clearer political leadership in the energy sector and the decisions that make the diagnosis of incentivizing “exports” to bring in the dollars that the country will need are a stumbling block just as or more severe than the additional complication of restricting access to foreign exchange for the payment of debts.
This, in the middle of the agreement that the industry seeks to weave with the unions.
The other debate: wealth tax
The president of the Budget Commission in the Chamber of Deputies, Carlos Heller, estimated on Thursday that next week the project of solidarity contribution will be advanced. He hopes that on Monday the opinion of the initiative promoted by the ruling party will be signed to take it to the premises in the next session.
The project establishes that 25 percent of the collected will be destined to the production and exploration in gas fields throughout the country through IEASA (Integración Energética Argentina SA) the former Enarsa, which would channel the funds so that YPF can allocate to their producing areas.
The figure would round up about 75 billion pesos. It would be something like a patch, although channeled through a single company, for the other front that the Kirchnerist bloc established with Decree 1053 of the government of Mauricio Macri.
It would be an additional alternative to guarantee the possible obtaining of resources for that scenario that the national government seeks to avoid: that of transferring more dollars in gas purchases abroad, something that at the same time seeks with the Gas 4 Plan, the subsidy under revaluation in Economy.