Pan American Energy LLC - Argentine Branch

completed

Pan American Energy LLC (PAE or the company) is engaged mainly in the exploration, development and production of oil and gas, and is the second largest oil and gas producer in Argentina by volume and gas owned and produced. The company holds interests in 23 oil and gas production blocks – 13 in Argentina and 10 in Bolivia, through its indirect Bolivian subsidiary Empresa Petrolera Chaco S.A. (Chaco) which represents approximately 7% of the total production of the company. In addition, PAE holds interests in 15 exploration blocks. The company’s blocks in Argentina are in the four major hydrocarbon basins – Golfo San Jorge, Austral, Neuquen and Northwest. The most significant blocks in terms of average net daily production, as of 2004, were Cerro Dragon in the Golfo San Jorge Basin, Cuenca Austral in the Austral Basin, and Acambuco in the Northwest Basin.PAE is a joint venture company in which BP plc (BP) has a 60% interest, with the remaining 40% held by Bridas Corporation.IFC’s proposed investment will help finance the Company’s 2005 capital expenditure program for the continued development and production of three key blocks – Cerro Dragon, Piedra Clavada and Koluel Kaike, all located in the Golfo San Jorge Basin (in the provinces of Chubut and Santa Cruz in Argentina). The project contemplates:- drilling for oil and gas, optimization of water-flooding projects and installation of facilities in the Cerro Dragon field; and -drilling and water flooding projects in the Koluel Kaike and Piedra Clavada blocks.