MercoPress. South Atlantic News Agency

ENAP/Methanex sign agreement to look for natural gas

Enap, Chile's government owned oil corporation and Methanex the huge methanol complex in the extreme south of the country signed this week an agreement to speed exploration and production of natural gas in the region.

Methanex which according to the original contract was to be entirely supplied by Argentina has been forced to cut production and eliminate jobs because of repeated cuts in gas provision. The Kirchner administrations privilege domestic consumption. The agreement signed in Santiago de Chile contemplates a three year investment of 100 million US dollars provided by Methanex and will concentrate in the Dorado-Riquelme block, 120 kilometers northeast of Punta Arenas and where Enap has been working since 2005. "We are pleased to announce the agreement with Enap which represents a landmark for returning our assets in Cabo Negro to full production. With this accord and a recent one with Geopark, and the new oil and gas activity recently launched in the area, we hope that the production of Chilean natural gas will increase significantly in the coming years", said Methanex CEO Bruce Aitken in a release. Paul Schiodtz, head of Methanex Latinamerica added that the Dorado-Riquelme block has the necessary infrastructure and gas pipelines which can ensure "that gas will be pumped to our plant in Punta Arenas by the end of the year" helping to resume production to full capacity. According to the agreement several wells will be drilled as well as the necessary infrastructure for the transport and sale of hydrocarbons found on a 50/50 participation. ENAP will act as operator of the undertaking. "Working with ENAP our main natural gas supplier in Chile with whom we have a 20 year close relationship is a most valuable opportunity to intensify the government private sector relation which represents an additional boost for the regional economy", said Rojas Ajenjo manager from the Cabo Negro plant. Methanex is a Canadian company located in Vancouver which produces, distributes and commercialized methanol world wide. The company's shares quote in Toronto, NASDAQ Global Market in New York and in the Santiago de Chile stock exchange.