Challenger Energy Group PLC (AIM:CEG, OTC:BSHPF) told investors that between 1bn and 2bn barrels worth of exploration prospects have been identified in its acreage offshore Uruguay.
The company, in a statement, noted that this new prospect inventory follows the reprocessing of 2D seismic data.
Among the prospects are three that are described as sizeable and as consistent with the conjugate margin discoveries made by Shell and Total in the waters off Namibia.
The company expects it will soon begin a farm-out process to seek an exploration partner.
Chief executive Eytan Uliel described the new prospect inventory as “extremely promising” whilst calling offshore Uruguay a “globally attractive exploration hotspot”.
“Our next-step objective is to farm-out to an industry partner(s), so we can fast-track a 3D seismic acquisition. The high-quality data set we have now compiled, and the intellectual property created, positions us well, and we will shortly be initiating a formal farm-out process.
“The world for Challenger Energy is changing rapidly.”
Uliel added: "In 2020, when no other parties were ready to commit, Challenger Energy was first-mover into offshore Uruguay, securing the AREA OFF-1 block on an uncontested basis and on highly advantageous work terms.
“Since then, margin-opening discoveries offshore Namibia by TotalEnergies and Shell have made it possible to correlate what are now proven, oil producing source rocks directly across into the conjugate margin basins of Uruguay's waters.
“As a result, Uruguay has become a new global exploration hotspot, evidenced by the fact that in the last 12 months all but one of the available offshore blocks have been licensed by oil majors and NOCs, bidding sizeable work programs.”
Challenger noted that a broader geotechnical assessment of the OFF-1 Area is on track to complete by the end of the third quarter and this accelerated programme of analysis will satisfy the entire minimum work obligations for the block's initial four-year exploration period.