Repsol to Participate in Ecuador Licensing Round

Repsol-YPF has purchased the rights to participate in the ongoing auction process for four government-owned oil fields in Ecuador, state-run Petroecuador said Tuesday.

The government plans to grant concessions for the Auca, Culebra-Yulebra, Lago Agrio and Shushufindi fields, whose potential total oil reserves are estimated at 904 million barrels.

Last week, Tecpetrol, a unit of Argentina's Techint , also purchased the rights to participate in the auction, though only for the Culebra-Yulebra field, which has estimate reserves of 73 million barrels of crude.

Though only two companies have so far signed up, Petroecuador says 14 other companies are interested, including companies from the U.S., Europe and Asia.

Interested bidders must submit their offers by January 23.

The winners will sign so-called `contracts of association' with the state-owned company, under which the government would have a 30% share of the new production generated at those fields, plus royalties. The contracts carry 20-year terms.

While Petroecuador says that companies having purchased the rights to participate is a sign of success, local analysts say that many companies will do so simply to acquire the most-recent data on the blocks.