Argentine president names CEO of newly nationalized oil company

By Michael Warren ,AP

BUENOS AIRES — Argentina officially recovered its leading energy company from private control on Friday as President Cristina Fernandez signed her expropriation measure into law and named a youthful Argentine as its chief executive.

The country’s leading politicians and all her top appointees gave her a standing ovation as she signed the measure sealing the fate of Repsol. The Spanish company now has little chance of seeing the US$10.5 billion it says its shares in YPF SA are worth until years of legal battles are resolved, if then.

She praised congress for overwhelmingly approving the takeover, and called it an affirmation of Argentine sovereignty that is far more important than any party differences.

“We want a YPF with an absolutely professional profile,” Fernandez added, describing her search for Argentines with deep experience in the global oil industry to run the company.

Her choice: Miguel Galuccio, an Argentine engineer who left YPF after Repsol bought it in the 1990s and rose through the ranks of Houston, Texas-based oil services giant Schlumberger Ltd.

She stumbled slightly in pronouncing Galuccio’s name and then urged him to stand up from front-row his seat alongside Axel Kicillof, the economist she appointed to root through YPF’s books for clues to its true worth. Both represent the future, she said.

“These are young men who want to take on historic challenges, to take responsibility for them and make sure that government is part of the solution,” she beamed.

Galuccio resigned as president of Schlumberger’s production management division in London and told his staff he was returning to Argentina on April 16, the same day Fernandez decreed the YPF takeover, the daily Ambito Financiero newspaper reported.

“Miguel seems like a good choice to lead the new YPF,” Stephen Ellis, a senior equity analyst who follows Schlumberger for Morningstar, Inc., told The Associated Press on Friday.

“I’m not condoning Argentina’s nationalization of YPF, which is a bad thing, but Miguel is a reasonable choice for the role,” since his unit operates in ways that are “pretty similar to running a regular oil and gas company,” Ellis said.

The markets seemed to agree: YPF shares rose 8.5 percent to close at US$15.35 Friday on the New York Stock Exchange after Galuccio’s pending appointment was reported.