Financial details regarding the transaction were not revealed by Chevron nor CEG Uruguay. (Source: Shutterstock)
Chevron Corp. received approval for farm-in at the AREA OFF-1 block offshore Uruguay, a Chevron spokesperson told Hart Energy Sept. 25 via email.
“Chevron, through its affiliate in Uruguay, confirms that is has been granted approval by the national oil company, ANCAP, to acquire a 60% interest in the AREA OFF-1 block, offshore Uruguay from CEG Uruguay SA, a subsidiary of Challenger Energy,” the spokesperson confirmed.
“Completion of the transaction is in final stages, pending further notifications and local registration. This acquisition further strengthens Chevron’s upstream exploration portfolio in the Latin America region,” the spokesperson said.
Financial details regarding the transaction were not revealed by Chevron nor CEG Uruguay.
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Uruguay’s ANCAP Eyes Offshore Potential, Second Energy Transition
After the transaction closes, Challenger Energy will have a 40% non-operating interest in AREA OFF-1 compared to 100% before the deal.
In terms of Uruguay’s electric power generational matrix, approximately 97% of the country’s energy comes from renewable sources: hydrogen, biomass and wind, ANCAP Energy Transition Professional Cecilia Romeu told Hart Energy in 2023.
Oil and gas production from offshore Uruguay would allow the small country—size and population—to boost diversity of its energy matrix.
Plans for AREA OFF-1
In the remainder of this year, Chevron and CEG Uruguay aim to define 3D seismic in the second half of 2024 and potentially acquire 3D in fourth quarter 2024, according to details published by CEG. 3D results are expected by fourth quarter 2025.
In August 2026, Chevron and CEG Uruguay will face a renewal of commitments on AREA OFF-1, according to CEG.
ANCAP runs the Open Uruguay Round, which includes two bid rounds per year. The round offers very moderate work commitment requirements and companies could have an area for six years before committing to a well, according to ANCAP.
In 2022, Uruguay awarded bids to the Challenger Energy Group (CEG Uruguay) for the OFF-1 area, Shell Plc (OFF-2 and OFF-7), Argentina’s state owned YPF SA (OFF-5), APA Corp. (OFF-6) and a consortium of both APA (operator) and Shell (OFF-4).
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