Page 12 - LatAmOil Week 26 2022

LatAmOil URUGUAY LatAmOil

In a separate statement issued last week, it said saying last week that he was optimistic about the
it “considers the entry into Uruguay of two potential of the newly assigned blocks.
well regarded international companies and the “The fact that oil might be found in the Uru-
commitment by both to undertake sizeable and guayan maritime shelf was lifted with the depos-
meaningful work programmes during an ini- its offshore Namibia, of similar geology,” he
tial exploration period (including 3D seismic commented, according to a report from Merco-
acquisition and new well drilling) to be a highly Press. “This has lifted considerably the potential
positive development, validating both the com- oil rating of Uruguay, and although exploration
pany’s decision to enter Uruguay in 2020 and is an extremely risky enterprise, possible success
underscoring the solid technical foundation in our continental shelf can be considered at
and excellent value proposition represented by 20%, compared to 8% to 11% before Namibia.”
the OFF-1 block.” Stipanicic continued: “We can say that Uru-
Challenger has said it views Uruguay’s off- guay is back again in the league of potential
shore zone as a conjugate to the section of the hydrocarbon provinces, plus the fact that polit-
Orange basin offshore Namibia, where Shell ical and social stability, not to mention respect
and TotalEnergies announced huge discoveries for contracts, makes Uruguay a long-term
of light sweet crude oil earlier this year. Alejan- attraction for the oil industry, and for any other
dro Stipanicic, the president of ANCAP, agreed, enterprise.” ™

ECUADOR
Ecuador’s government strikes deal with

CONAIE on fuel prices to end protests

ECUADOR’S oil industry may be in a position levels went down by 50% on Sunday alone, in a
to resume operations soon now that the govern- decline that largely resulted from road closures,
ment has struck a deal with CONAIE, one of the the seizure of oil wells and vandalism. Prior
leading organisations representing the country’s to the start of this wave of protests, the South
indigenous communities, ending nationwide American state had been producing 520,000
protests over fuel prices and other issues. barrels per day (bpd) of oil.
The government announced the agreement An estimated 14,000 protestors were partici-
on June 30, saying it was ready to cut gasoline pating in the demonstrations as of the weekend,
and diesel prices by the equivalent of $0.05 per with the largest events occurring in the capital
gallon each on top of a previous pledge to reduce city of Quito. The capital has already begun
rates by $0.10 per gallon each. The price cuts are experiencing fuel shortages, along with soaring
expected to cost the government about $340mn prices as a result.
per year, according to Ecuador’s Finance According to Production Minister Julio Jose
Ministry. Prado, the demonstrations have led to publi
Quito also offered concessions with respect and private-sector economic losses in excess
to CONAIE’s demands to rein in the expansion of $500mn. “Each additional day of downtime
of the mining and oil industry. According to represents $40-50mn lost,” Prado commented.
press reports, President Guillermo Lasso offered He explained that the protests had led to the
to discard a draft decree on oil investment and loss of 8.5mn litres of milk worth $90mn, as well
revise another decree on mining investment to as $90mn worth of agricultural and livestock
ensure that local communities had the right to products. Meanwhile, he said, fears stemming
be consulted on new projects. from the protests have hit Ecuador’s tourism
CONAIE began leading a wave of demon- industry, with cancellation rates of up to 80%,
strations on June 13. Participants in those pro- resulting in losses of more than $50mn.
tests set up roadblocks across 19 of the country’s “In the flower farm sector, 12 days of shut-
24 provinces, thereby causing enormous disrup- down resulted in $30mn in losses and damage
tion to transportation networks. to trucks and farms,” he added.
As a result, Ecuador’s Energy Ministry said While the extent and nature of the protests
on June 26 that oil production had reached a has varied by region, violet clashes stemming
“critical level” in the face of protests across the from the nationwide demonstrations had
country. It warned that unless the roads were resulted in the total deaths of at least five people
cleared, oil production might come to a halt as of June 26. A further 500 people are estimated
within 48 hours. to have been injured in clashes between protest-
Government data showed that production ers and the police. ™

P12 www. NEWSBASE .com Week 26 30•June•2022