Argentina’s congress has approved the country’s takeover of the Spanish-owned YPF oil company, clearing the way for President Cristina Fernandez Kirchner to sign the bill into law.
The lower house approved the takeover of YPF by a 207-32 vote on Thursday. The Senate approved the bill last week.
Deputies in congress debated the law, which includes the expropriation of Spanish energy company Repsol’s $10.5bn controlling stake in the oil company.
Spain has threatened to retaliate against the so-far-uncompensated takeover of YPF, and the Moody’s rating agency has said that trading with Argentina is now riskier than before.
Argentine policy makers, however, have brushed off concerns, and more than three-fourths of legislators approved the law during Thursday’s vote.
President Kirchner, a combative career politician who has tightened state control of the economy, unveiled the plan to take over YPF from Repsol six months after her landslide re-election last year.
Agustin Rossi, head of the ruling party bloc in the lower house, heralded the move as a watershed in the country’s energy policy.
“We’re going to see a big improvement and a big difference [although] it’s probably going to take a few years for us to achieve energy self-sufficiency,” Rossi said.
“This isn’t just about YPF, [all companies] will have to keep in mind that their business is a matter of public interest
and the aim is self-sufficiency,” he added.
Kirchner has justified the renationalisation of YPF, which was privatised in the 1990s, on the grounds of low investment in boosting oil and natural gas production.
The lack of growth in production has slowed overall economic growth in Latin America’s third-largest economy.
Repsol denies that there has been under-investment.
Once Kirchner signs the YPF bill into law, attention will turn to how much compensation Argentina will pay Repsol.
Officials say it will be less than the $9.3bn the Spanish company wants.