Spanish oil major Repsol says as part of a compensation deal struck with the Argentine government for the expropriation of its former unit, YPF, it will take a charge of 1.28 billion euros ($1.76 billion) on its 2013 earnings.
In May 2012, Argentina's Congress passed legislation to seize a controlling stake in YPF from Repsol after President Cristina Fernandez declared the shares to be a public good and said the Madrid-based company was not investing enough in the South American country.
The expropriation sparked diplomatic tensions between Spain and Argentina, and Repsol vowed it would seek at least $US10.5 billion ($A11.68 billion) compensation for its former unit.
Before Friday, the expropriated stake in YPF had been on Repsol's books at 5.39 billion euros.
On Friday, however, the Spanish oil major said in a regulatory filing the seized shares were worth $US5 billion.
"At year-end 2013, due to the heads of agreement announced in November in relation to the shares of YPF S.A. and YPF Gas S.A. subject to the expropriation process, their value has been adjusted to $US5 billion.
"Therefore, an impairment of 1.28 billion euros after tax will be recorded in the full-year 2013 results," Repsol said.
The $US5 billion figure matches the amount of compensation the Argentine government has agreed to pay Repsol in the form of dollar-denominated bonds.
