Uruguay hands out four oil and gas exploration blocks
Uruguay
MONTEVIDEO, December 18, 2023 – Uruguay has signed contracts for four offshore oil and gas blocks in the Pelotas basin to begin exploration activity, Upstream Online reported on Thursday.
The local NOC and regulator ANCAP signed exploration contracts with US E&P player APA Corporation for the OFF-6 block, two contracts with UK energy giant Shell for the OFF-2 and OFF-7 blocks and a contract with Argentina’s state-owned oil and gas company YPF for the OFF-5 block.
ANCAP also confirmed that a contract for the OFF-4 block will be signed shortly with a 50:50 consortium consisting of APA Corporation and Shell.
Additionally, it confirmed that a contract will be signed with Americas-focused independent Challenger Energy for the OFF-3 block.
Previously Challenger Energy signed a contract with ANCAP to explore the OFF-1 block.
The awards are part of the Open Uruguay Round auction that was launched in 2019.
The PSAs include both exploration and production activities and have a duration of up to 30 years with four-year commitments necessary to allow for further extensions.
The minimum work programs under the bid round entail 3D seismic acquisitions and reprocessing, and in the case of APA Corporation’s OFF-6 concession, a deepwater exploration well.
The government anticipates that seismic works could occur as early as late 2024 or early 2025.
A 3D seismic campaign encompassing 2,500 square kilometres will be carried out by APA Corporation and Shell on the OFF-4 block for a consideration of USD 130 million.
“This is a historic event for the country because it is the first time that all offshore areas will have current contracts,” said Alejandro Stipanicic, president of ANCAP.
“These are large energy companies that are investing in renewables, in the production of advanced biofuels, green hydrogen, the search for white hydrogen and carbon capture and storage. Their presence in the country lends support to ANCAP’s strategy related to the second energy transition.”
The move follows Brazil handing out acreage in its latest bid round to energy players such as Petrobras, Shell and Chevron in December 2023.
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