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Oil Majors Converge On Uruguayan Offshore Play

Oil Majors Converge On Uruguayan Offshore Play

I wrote yesterday about offshore natural gas exploration accelerating in Myanmar. And this week we got news that another major offshore exploration trend has struck again, this time in the fast-emerging destination of Uruguay.

Major European producer Statoil announced Monday that is has signed its second deal this month for exploration acreage in the Uruguayan offshore sector. With the E&P agreeing to take a 35% stake in Block 15 of the Pelotas Basin, held by junior developer Tullow Oil.

The farm-in is further confirmation of a trend in motion here. Coming just two weeks after Statoil announced it was taking a 15% interest in Uruguay’s Block 14 from owners Total and ExxonMobil. Related: The Decline Of The Coal Industry Is “Long-Term” And “Irreversible”

Statoil’s management said that the company’s aggressive moves in Uruguay are following a strategy of “access at scale”. Suggesting that the firm likes the fact it can get a big position here across a prospective basin.

Indeed, the Block 15 license builds nicely on Statoil’s existing acreage as it is located immediately adjacent to the Total/Exxon Block 14.

And those aren’t the only big players attracted by the potential here. With Statoil’s new Block 15 license also having Japanese major INPEX as a 30% interest holder. Related: Why OPEC Production Freeze Could Pave The Way For Actual Cuts

Interestingly, Statoil’s new Block 15 license hasn’t seen as much work as the Total/Exxon acreage. With operator Tullow planning to conduct a 3D seismic survey here as a next step.

Such work has already been completed at Block 14 — which is quickly advancing toward first drilling. This suggests that Statoil may have seen potential in its due diligence with Total for hydrocarbon traps extending onto the neighbouring Block 14 ground.

Whatever the case, a wide variety of oil and gas groups are seeing something they like here. Watch for more deals being done in this space — and for announcements from Tullow Oil on results from upcoming seismic work on the Block 15 area.

Here’s to getting a big position

By Dave Forest

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