Challenger Energy Group PLC (AIM:CEG, OTC:BSHPF) has announced the formal signing of its OFF-3 licence, offshore Uruguay.
It seals the licence award announced by Challenger in June, and, further expands the explorer’s footprint in Uruguay.
The signing comes after last week’s major announcement, of the company’s new partnership with Chevron in the separate OFF-1 licence area.
The newly signed OFF-3 acreage spans over 13,252 square kilometres in relatively shallow waters, roughly 100 kilometres off the Uruguayan coast.
Challenger highlighted that OFF-3 already has some seismic data, from which two significant prospects have been identified. The areas’ resource potential has been estimated at 2 billion barrels of oil and 9 trillion cubic feet of gas.
Initially, Challenger’s commitments are modest, with the company required to reprocess the existing 2D seismic data and undertake geotechnical studies.
“AREA OFF-3 represents a successful expansion of the company's business in Uruguay, a country that has fast become one of the world's frontier exploration hotspots,” chief executive Eytan Uliel said in a statement.
He added: “We believe that AREA OFF-3 has strong technical merit and offers an exciting value-creation opportunity.
“Therefore, like with AREA OFF-1, our immediate strategy for AREA OFF-3 is to commence accelerated technical work, in support of seeking an early farm-out.”