Uruguay state-run energy firm Ancap is set to agree to final terms for a record number of seven offshore exploration licenses next month, a senior executive told Reuters, as the frontier market lures bets from global players like Shell .
"Uruguay has never yielded a commercial discovery," said Andres Armijos, head of Latin America research at energy consultancy Welligence. "From an oil and gas point of view, it is high risk, but that's what companies are chasing."
Britain-based Challenger Energy was awarded two of the seven licenses in Uruguay, following unsuccessful exploration projects in the Bahamas and Trinidad and Tobago. Challenger CEO Eytan Uliel told Reuters from London that Uruguay's government was "extremely committed and supportive," though cautioned things were "in the early stages." The Namibia finds, though, had raised the chances that oil could be found, he said.
The next step is to evaluate the areas by reviewing the seismic data so far collected to establish well locations. Drilling could begin as soon as 2026, Challenger has said. "We have kilometers of seismic data, dating back to the 1970s. Using modern technology, we can create a different picture of what is there," Uliel added.
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