Ministry Awards 3 E&P Licenses in Rafael Urdaneta Phase B

Venezuela's energy and oil ministry has awarded three exploration and production licenses for three offshore blocks in phase B of the Rafael Urdaneta tender in western Venezuela, energy and oil minister and state oil firm PDVSA president Rafael Ramírez announced on Tuesday.

The awards brought in a combined US$61.3mn in license fees, Ramírez said. The phase B tender was held on November 9 in Caracas.

The 30-year licenses will be formally signed on November 30 at an official ceremony in Paraguana, Falcón state, Ramírez sad.

The Castillete Noreste 2 block was awarded to Vinccler Oil & Gas, the Venezuelan unit of Canadian oil company PetroFalcon (TSX: PFC). Vinccler paid US$7.38mn.

The Moruy 2 block went to a consortium made up of Brazilian federal energy company Petrobras (NYSE: PBR) and Japanese energy firm Teikoku for US$19.5mn. Lastly, Italy's Eni and Spain's Repsol YPF paid US$34.4mn for the Cardon 4 block.

Another two blocks, Urumaco 3 and Cardon 2, were declared void as no offers were submitted for them, but Ramírez said they could be offered again at some point down the road.

PDVSA can acquire up to 35% in each project once commercial feasibility is declared.

In phase A of Rafael Urdaneta last month, two blocks were awarded to Russia's Gazprom and another to US company Chevron (NYSE: CVX).

Natural gas from the six blocks awarded in phases A and B will be used for thermal power generation and secondary oil recovery, Ramírez said.

The Rafael Urdaneta project consists of 29 blocks in the Gulf of Venezuela off northern Falcón state, with total gas deposits estimated at 26 trillion cubic feet. Venezuela plans to tender the blocks in different stages.

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