Chile awards E&P rights for offshore blocks
Eric Watkins
Senior Correspondent
LOS ANGELES, Nov. 16 -- Chile has awarded oil and gas exploration and production rights to foreign companies that will invest at least $267 million each in the southern Magellan region.
"It's historic," said Mining Minister Karen Poniachik. "The round is going to contribute to the diversification of our country's energy supply and millions of dollars are going to be spent in the area."
Poniachik said contracts will be signed with Total SA, Apache Canada Ltd., Pan-American Energy LLC, Greymouth Petroleum Holding Ltd., and IPR-Manas.
IPR-Manas was awarded E&P rights for Tranquilo block, and plans to invest $33.3 million in the three phases of exploration.
Apache was awarded both Russfin and Lenga blocks, where it plans to invest $23.4 million and $24.9 million, respectively.
Greymouth was awarded Provenir, Brotula, Isla Magdalena, and Caupolican blocks. It plans to spend a total of $107 million in the three exploration phases.
Total was awarded Otway block, where it will invest $44.5 million. Pan-American was awarded the Coiron block, where it will invest $34 million.
No bids were received for the Bahia Inutil block.
The winners will sign special operating contracts with the government that will run for as long as 35 years, including a maximum 25-year production phase.
The first phase of exploration will begin when contracts are formally signed in December and will last for 36 months. The second and third phases will last for 24 months each.
Poniachik said each company has promised to begin exploration within six months of signing the contract.
"They'll begin exploring immediately after the contracts are signed in December," she said, adding, "They'll want to take advantage of the warm summer weather we're having in the region at the moment."
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