Repsol said its exploration in the Loma La Lata area of Argentina uncovered 927 million barrels of oil equivalent, of which 741 million barrels are oil.
The company drilled 15 vertical wells, which produced an initial 5,000 barrels of oil per day of what the company described as high-quality shale oil.
Repsol said further exploration of the areas shows potential for "large volumes" of hydrocarbons.
Energy group Wood Mackenzie described the region, known as Vaca Muerta, as one of the best shale plays in the world.
"These resources will transform the energy potential of Argentina and South America, boasting one of the world's most significant accumulations of non-conventional resources," Repsol said.