MercoPress. South Atlantic News Agency

Australia’s Petrel Energy farms in with US explorer operating onshore Uruguay

Managing director David Casey: Piedra Sola and Salto shale concessions a fantastic opportunity

Australia’s Petrel Energy is getting involved in Uruguay after taking a stake in a private US player which also gives it a presence in Spain. The Sydney-based explorer said its 25% stake in Schuepach Energy International (SEI) gives the company a shot at unearthing “company-making” large scale oil and gas discoveries.

Petrel would appear, however, to not be holding out too much hope for the share in a Spanish concession acquired in the deal and is instead concentrating on Uruguay.

SEI holds the Piedra Sola and Salto concessions in Uruguay as well as an 85% share in two gas-prospective licences in southern Spain.

Petrel is stumping up 2.5 million dollars in cash for the company purchase which will cover the first phase of a three-stage work program, primarily in Uruguay. It also has two options to boost its holding in SEI to 60% over the next 18 months for a further 11.5 million.

Managing director David Casey said: ”The Piedra Sola and Salto shale concessions onshore Uruguay represent a fantastic first-mover opportunity for a company of Petrel’s size, in an asset with the resource potential normally associated with major oil companies.

“While there is obviously a lot of work ahead of us to realize this potential, the right ingredients are there for a significant onshore oil province.” A company statement continued: “Uruguay is attractive for petroleum exploration for a number of important reasons.

“The Norte Basin in Uruguay, forms part of the same oil-producing Devonian basin system which extends into neighboring Brazil and is also productive in Bolivia and Argentina, but is largely unexplored in Uruguay.”

Petrel appears less optimistic about the Spanish assets, saying: “Petrel does not expect to commit significant funds to the Spanish project, with SEI seeking to farm-out these assets, which flowed modest amounts of gas to surface from well tests in the late 1950’s.