British company to search for oil and gas in the Uruguayan Sea

RIO DE JANEIRO, BRAZIL – The British hydrocarbon exploration and production company Challenger Energy Group (formerly Bahamas Petroleum) announced in the last days that it obtained the authorization of Uruguay’s Executive Power to carry out exploration works in the Uruguayan sea (offshore).

The oil company had bid in 2020 for area 1 in the framework of the Uruguay Open Round carried out by Ancap, and both the approval of the license and the signing of the contract were under study.

During an initial period of four years, the minimum work obligation will be to reprocess and reinterpret selected historical 2D seismic data, with no obligation to drill, the company stated in a communication to the London Stock Exchange.

The license is for 30 years, and the oil company can choose to move to phases 2 and 3 after the initial stage.

Area 1 has approximately 15,000 km2 and is located in water depths of 20 to 1,000 meters, about 100 km off the Uruguayan coast. According to the company, it contains an estimated resource potential above 1 billion barrels of oil.

In addition, Challenge Energy noted that the exploration area is “directly analogous to recent prolific discoveries made offshore Namibia by Total (the Venus well) and Shell (the Graff well), where Cretaceous turbidite reservoirs of billions of barrels have been found.”

“Two years ago, at the height of an industry downtime due to the pandemic, we identified a compelling opportunity to apply for the OFF-1 license in Uruguay. We obtained a very high-quality exploration license for a very low cost,” stated CEO Eytan Uliel.

The executive added that partnership options will be explored in 2022 and 2023 that could lead to an “accelerated” work program, which aims to “quickly and fully evaluate the potential of the license and thereby create what is expected to be a high-value opportunity for shareholders.” Challenger Energy operates in Trinidad and Tobago, Suriname, and the Bahamas.

ANCAP RECEIVED NEW OFFERS

On the other hand, last Tuesday, May 31, was the deadline for the first annual window for the oil companies APA Corporation (ex Apache) and Shell that had qualified in the Open Round 2022 to submit bids. According to El Observador, Ancap is studying the bids received and will announce them soon.

The current open round system allows oil companies to qualify and submit bids during the year. In this way, two stages are carried out per year, with the opening of bids in May and November.

If there is competition for the same area in the same semester, bids are compared, and the area is awarded to the offer with the highest score.

Companies can qualify exclusively for the exploration period without drilling, the exploration period with drilling, or the exploration and exploitation periods. Today six offshore areas are offered, according to information published by Ancap.

With information from El Observador