There’s not too much one can do when a government minister marches into your office and essentially tells you to get lost. On April 16, 2012, the normal Monday morning routines unfolded with greater tension in the Buenos Aires offices of Spanish energy company Repsol’s YPF subsidiary. As top planning executive Carlos Jiminez and his colleagues were watching President Christina Fernandez unveil plans to seize control of YPF and nationalize Argentina’s leading energy producer, the unthinkable happened.
“About 30 minutes before she finished her speech, the undersecretary of planning and the state representative on the (YPF) board, Roberto Baratta, marched in and said the business relationship was ended,” Jiminez recalled after a luncheon in New York this week.
“All they said was ‘We need the office’, and that was that. We had 10 minutes to get our stuff and get out. Our e-mails and phones were cut off within 15 minutes of their arrival. It was a shock. Simply, that the relationship was finished. I never thought this would happen,” said Jiminez.
In February 2012, Argentine officials accused the oil company of denying them entry to a board meeting. It was the early days of the pressure being applied to the company, and the local energy industry in general, by the Fernandez government to boost oil and natural gas output as fuel imports were soaring.
“We began to hear rumors last February that something like the expropriation might happen. We had 15,000 workers at YPF out of a total of 28,000 for Repsol overall,” said Arturo Gonzalo, corporate director of institutional relations and corporate responsibility. Gonzalo spoke during a luncheon sponsored by the Hudson Institute, a conservative think tank in New York.