NEW YORK, July 14 (Reuters) - A U.S. judge on Monday

temporarily halted enforcement of an order requiring Argentina

to turn over its 51% stake in oil and gas company YPF

to partially satisfy a $16.1 billion court judgment. The

decision by U.S. District Judge Loretta Preska in Manhattan

affords temporary relief to for the cash-strapped South American

country, which has warned its economy could be destabilized if

it were forced to give up the YPF stake. A turnover had been

scheduled for Monday, but Preska extended the deadline to July

17 to allow time to appeal.

Argentine President Javier Milei has been seeking to bolster

foreign currency reserves and rein in soaring inflation while

dealing with a heavy government debt burden.

The dispute arose from Argentina's 2012 decision to seize

the YPF stake from Spain's Repsol without making a

tender offer to minority shareholders Petersen Energia Inversora

and Eton Park Capital Management.

Those shareholders are represented by litigation funder

Burford Capital, which has said it expected to receive

35% and 73% of Petersen's and Eton Park's respective

damages.

In September 2023, Preska ordered Argentina to pay $14.39

billion to Petersen and $1.71 billion to Eton Park.

Argentina has not paid the judgment while it appeals. On

June 30, Preska ordered the government to turn over the YPF

stake within 14 days.

The country has argued that the YPF shares were immune from

turnover under the U.S. Foreign Sovereign Immunities Act, while

Burford said a commercial activity exception and years of

evasion by Argentina justified a turnover.

In a court filing on Thursday seeking to delay the turnover,

Argentina told the appeals court "the stakes could not be

higher."

It warned that requiring a turnover would irreparably harm

its sovereignty, interfere with foreign relations, violate

international law and wrongly expand U.S. courts' power.

Argentina likened a turnover to a foreign court ordering the

U.S. government to ship gold reserves stored at Fort Knox

outside the country because that court misinterpreted U.S. law.

The country also said it would be unfair to give up its

controlling stake in the country's largest energy company now,

because doing so would likely be irrevocable even it ultimately

won the case.