MercoPress. South Atlantic News Agency

Extension granted to companies searching for oil off Argentina's shores

The companies had difficulties carrying out the committed tasks due to the COVID-19 pandemic sanitary restrictions

Argentina's Energy Secretariat extended until 2024 the oil offshore exploration permits of ExxonMobil and Qatar Petroleum (QP) to operate in the Argentine Sea, it was reported earlier this week in the Official Gazette.

The new authorization encompasses the so-called West Malvinas Basin area (MLO_113), on the Fuegian coast of the Argentine Sea. The measure was ordered through resolution 752/2022.

The original grant dates back to May 17, 2019, in the framework of the Offshore International Public Tender, in which permits were obtained in 18 areas of three basins for a total investment of US$ 724 million.

In the case of the MLO_113 area, the bid of ExxonMobil Exploration and Production Offshore Argentina SRL and QP Oil and Gas SAU was US$ 30.1 million.

Many companies had requested the suspension of the deadline because the exploration of hydrocarbons in offshore areas entails the hiring of vessels specially designed to carry it out, “whose availability depends on the level of activity, logistics of the operation and weather windows, among other variables,” the resolution read.

Hence, the authorities found it “convenient to grant a reasonable period of time to carry out the pending activities and their subsequent interpretation and technical and economic evaluation.”

Similar extensions (one year) had been signed last for the MLO_117 area and in September for the MLO_118 area.

ExxonMobil Exploration and Production Offshore Argentina is the operator with 70% participation and is associated with QP Oil and Gas, which owns the remaining 30%.

The exploration permits for the MLO_113 block had been granted in 2019 after making bidding US$ 30.1 million, while the MLO_117 and MLO_118 areas had been awarded after offering US$ 34.4 million and US$ 29.95 million, respectively.

The companies had difficulties carrying out the committed tasks due to the COVID-19 pandemic sanitary restrictions.