As global oil prices rise, so too has interest in offshore drilling with countries like Brazil and Guyana attracting a lot of attention. However, the renewed interest seems to be passing over Uruguay which failed to attract bids for any offshore blocks.
ANCAP, the state-owned oil company, published the results of the bidding process last week.
Tullow Oil and AziLat Petroleum were the only companies to submit documents for Uruguay Round 3. Ultimately neither company submitted offers for the 17 blocks up for bid.
ANCAP said that more than 30 companies were involved earlier on in the process. “However, the situation of the oil industry, with several consecutive years of low oil barrel prices, has implied a massive reduction of exploration budgets in border basins,” explained ANCAP.
Oil prices fell by more than two-thirds from $100 per barrel in August 2014 to less than $35 per barrel in January 2016. Prices steadily rose after cratering in early-2016 and especially since last summer.
At just under $75 per barrel, oil prices today are nearly 50 percent higher than a year ago.
Uruguay has attracted more than one billion dollars in investment in hydrocarbons since 2008 under its current framework.
After the latest failure of Uruguay Round 3, ANCAP says that it will evaluate how it can modify its process to reflect current market conditions.