US appeals court pauses investors’ efforts to trace Argentine assets in YPF case

U.S. Appeals Court Pauses Asset Hunt in Argentina’s $16 Billion Energy Nationalization Case

A U.S. Appeals court has temporarily halted efforts by investors to identify Argentina’s assets in the United States as they seek to collect on a massive $16 billion judgment related to the 2012 nationalization of YPF, the South American country’s largest energy company.

The ruling by the U.S. Court of Appeals for the Second Circuit in New York prevents former shareholders Petersen Energía and Petersen Energía Inversora from proceeding with their search for Argentine assets, including gold reserves held by the central bank, until pending appeals in the case are resolved.

The shareholders, backed by litigation funder Burford Capital, have been pursuing compensation since U.S. District Judge Loretta Preska ordered Argentina to pay for the government seizure of a majority stake in YPF Energy more than a decade ago.

Argentine President Javier Milei quickly celebrated the decision, describing it as a “historic” and “unprecedented” development favorable to Argentina’s position. “This decision represents a historic milestone in the defense of the Argentine Republic in litigation that, for more than 12 years, has imposed enormous economic, legal and reputational costs on the country,” Milei said in an official statement.

The Argentine government had formally requested the suspension of the discovery process on March 6, according to government officials.

However, litigation specialists caution that this procedural victory doesn’t signal a final resolution of the case. Sebastián Maril, a Latam Advisors analyst specializing in litigation, clarified that the decision merely pauses secondary proceedings like asset tracing until the court rules on Argentina’s substantive appeal. Oral arguments in that appeal were heard last October, with a decision still pending.

The judgment amount, originally set at $16.1 billion, has already grown to more than $18 billion with accrued interest, representing a significant financial threat to Argentina’s struggling economy.

In June last year, Judge Preska had ordered Argentina to transfer its 51% controlling stake in YPF as partial compensation to the plaintiffs, but the appeals court suspended that order two months later.

The case stems from actions taken during former President Cristina Fernández de Kirchner’s administration. In 2012, her government nationalized YPF, taking control from Spanish energy giant Repsol and other shareholders without following proper buyout procedures outlined in the company’s bylaws.

Milei, a libertarian economist who took office in December facing severe economic challenges, has blamed the legal predicament on his political opponents. His administration is grappling with depleted foreign reserves and has pledged to privatize numerous state-owned enterprises as part of sweeping economic reforms.

The plaintiffs were able to pursue their case in U.S. courts because YPF is listed on the New York Stock Exchange, giving American courts jurisdiction over certain aspects of the company’s operations and obligations.

Despite the ongoing legal battle, YPF has continued developing Argentina’s vast energy resources, particularly in the Vaca Muerta (Dead Cow) shale formation in Patagonia, one of the world’s largest unconventional oil and gas reserves. Crude production at Vaca Muerta has steadily increased, reaching nearly 600,000 barrels per day in January 2023, accounting for approximately 68% of Argentina’s national output.

The company reported its highest profit in a decade in 2025, earning $5 million, highlighting the economic significance of the energy firm to Argentina’s future prosperity, regardless of how the legal battle ultimately concludes.

The case underscores Argentina’s complex history with international investors and foreign courts, as the country continues to rebuild its financial credibility following multiple debt defaults over past decades.