Uruguay gives Challenger Energy green light for offshore bid

Uruguay’s state-owned hydrocarbons company Ancap approved a bid from upstream firm Challenger Energy for offshore block OFF-3.

Remaining authorization and signing processes are due to take three to four months, Challenger stated in a regulatory filing.

The area was offered under Uruguay’s open round. 

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Committed work includes geological modeling and licensing and reprocessing of existing 2D seismic. Under an initial four-year license period, Challenger has no obligation to acquire new seismic or drill an exploratory well.

Isle of Man-registered Challenger is the only upstream player so far to have actually signed an exploration and production license contract with Ancap, for OFF-1. Challenger recently said it had started a farm-out process to support a plan of fast-tracking 3D seismic acquisition in 2024.

No more areas are available under the open round.

In 2022, Uruguay received three offers for two offshore hydrocarbons areas under the open round. Argentine state hydrocarbons firm YPF bid for areas OFF-4 and OFF-5, and a consortium comprising APA and Shell bid for OFF-4.

In the first round of 2022, Ancap awarded acreage to APA and Shell. Shell was granted rights to blocks OFF-2 and OFF-7 while APA was awarded block OFF-6. 

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Argentine gas transporter TGN has completed a 3bn-peso (US$11.6mn) flow-reversal project on the Gasoducto Norte pipeline, part of a wider initiative to support the flow of Vaca Muerta gas to the country’s north, today supplied by dwindling imports from Bolivia.

The work was carried out at the Leones and Tío Pujio compression stations, facilitating the south-north flow of gas to Córdoba province in central Argentina and boosting transport capacity to 10Mm3/d from 7Mm3/d. The TGN work on the stretch will result in savings of an estimated US$23mn a month once the Vaca Muerta pipeline, also known as Presidente Néstor Kirchner, is in operation. 

A tender for the main flow reversal project, which will require around US$713mn, is pending. Elements include a 150km stretch of duct that will connect infrastructure running from Vaca Muerta and operated by fellow player TGS to TGN’s Gasoducto Norte, as well as further compression station work along Gasoducto Norte.

The work, deemed urgent, is linked to the Vaca Muerta gas pipeline project. The first phase of this project is being brought online this month. The second phase, penciled in to go into operation in the southern hemisphere’s 2024 winter, would facilitate increased gas flows to the north and, following the completion of further flow-reversal projects, the full substitution of Bolivian imports and growth in exports.

Gasoducto del Norte runs between General Pacheco in Buenos province and Campo Durán in the north of Salta province, near the Bolivian border.

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Argentine consortium CMA-1 will conduct workovers offshore Tierra del Fuego and build a wind park to help power operations, local media outlet EconoJournal reported, citing project sources.

CMA-1, formed by TotalEnergies, Wintershall Dea and Pan American Energy, is said to be targeting wells in the Aries acreage in the Austral basin, offshore Tierra del Fuego province. 

Once in operation, the wind park would power compressors, substituting gas, which would be injected into the pipeline system, it added.  

Last week the government said the companies had been granted supply contracts, running until December 2028, with state energy company Energía Argentina and wholesale power market administrator Cammesa.

CMA-1 is already carrying out the US$700mn Fénix gas production project, which involves platform installation and associated work at its basin acreage.

CMA-1 has multiple gas wells and platforms in operation, as well as two onshore treatment plants. CMA-1 output is around 17Mm3/d and Fénix, due online in 2025, should contribute up to 10Mm3/d more.