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Brazil Joins Argentina to Explore Malvinas Basin for Oil

Brazil's state-controlled oil multinational Petrobras, Argentina's YPF and Pan American Energy signed several agreements for the joint oil and gas exploration offshore in the San Jorge Gulf, the Malvinas basin and along the South Atlantic coastline, according to a report released Wednesday in Buenos Aires.

The initial overall investment will demand US$ 220 million and includes surveying an area of 1.320 square kilometers (0.51 square miles) and drilling four exploratory wells in the next two years.

The first agreement was signed between YPF's Executive vice president Sebastian Eskenazi and Petrobras Argentina CEO Decio Oddone with YPF acting as the operator and holding 67% of the association, and Petrobras the remaining 33%. The two companies have earmarked an additional US$ 120 million for their joint undertaking.

The other agreement between the three companies involves exploratory seismic surveys in a strip extending from Rio Grande do Sul, Brazil southern most state, all the way to Tierra del Fuego. Two exploratory wells have been planned for next year, demanding US$ 100 million investment.

"If exploration is successful the companies anticipate significant investments to develop the offshore reserves," said the release.

Finally a third agreement involves YPF, Petrobras Brazil and Petrobras Energy and will begin exploration activities in several blocks of the Malvinas basin, more than 200 kilometers offshore Tierra del Fuego.

In related news next December 20, Argentina's energy company Enarsa and YPF are scheduled to begin drilling off the coast of Santa Cruz province, according to the Ministry of Federal Planning.

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