MercoPress. South Atlantic News Agency

Uruguay: risk contract with US company to explore for natural gas onshore

The two year contract covers an area of 10.000 kilometres in the north of the country and will try to locate formations of lutite

Uruguay signed on Friday the first risk contract for the exploration of hydrocarbons in the north of the country, the first ever of its kind. US company Schuepbach Energy from Dallas will be looking for possible traces of natural gas in lutite sedimentary rocks during a two year period in an area of 10.000 square kilometres.

The contract signed by Uruguay’s government owned oil and gas company Ancap establishes that following the two years exploration and if positive traces have been found and clearly located, an international bid will be called with Schuepbach having preference.

“The minimum exploration program includes the analysis of samples, lutite maturing models and a feasibility study”, said German Riet, Ancap chairman of the board.

He added that in the two year period “Schuepbach will have the priority for an exploration-exploitation contract in the area”.

Lutites are sedimentary clastic rocks with clay or silt grains which can contain hydrocarbons remains and thus gas or other liquids could be extracted and used for the generation of electricity in power plants, added Riet.

For energy short Uruguay “it is crucial to diversify its power sources which could also help reduce the need for oil refined products from overseas”.

According to the Schuepbach site the natural gas and energy company was founded in 2007 by Martin Schuepbach and pursues “the meaningful exploration of scalable gas reserves around the world”.

Martin Schuepbach is “a leading geologist and entrepreneur in global oil and gas exploration, For over thirty years he has been responsible for many pioneering evaluation and exploration efforts across the globe for some of the world’s leading public and private oil and gas corporations”.

Schuepbach has a PhD in Geology from Rice University, Texas, 1974.

The company is “presently active in the Marcellus Shale, (Appalachian basin) arguably the next frontier for domestic for US natural gas exploration”.