Repsol YPF Signs Contract for Block 109

Peru's hydrocarbons promotion agency Perupetro has signed a contract with Spanish oil company Repsol YPF (NYSE: REP) for block 109 between Loreto and San Martín departments, Perupetro said in a statement on Friday.

Repsol YPF will have seven years to explore the 899,755 hectare block with a possible three-year extension. If exploration is successful, oil production will be for 30 years and natural gas production for 40 years, the statement said.

Repsol YPF is required to invest at least US$40mn in the block, and if results are favorable investment in development of the field could reach US$500mn, Perupetro said.

The exploration stage includes a geological study, shooting and interpreting 300km of 2D seismic and drilling three exploration wells.

The contract is the ninth to be signed this month, bringing the total number signed by Perupetro this year up to 15 from six in 2004.

A contract for block 76 with US company Hunt is pending approval by President Alejandro Toledo, but will probably not be finalized this year, a spokesperson previously told BNamericas.

Perupetro officials were not immediately available to comment.

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