Following the recent news that 13 companies provisionally won a total of 18 blocks in Argentina’s First Offshore Licensing Round,
Toya Latham, Upstream Oil & Gas Analyst at GlobalData, a leading data and analytics company, offers her view on the deal:
“Major players with significant interests in offshore Latin American countries have successfully bid for acreage offshore Argentina. Over half of the companies that were awarded acreage also have assets in neighbouring Brazil and acquired acreage in Mexico’s deepwater rounds. Argentina’s First Offshore Licensing Round offered blocks in under-explored areas with limited exploration activity. The entrance of these large players with Atlantic margin experience is a major coup for the upstream sector in Argentina, as companies are stepping up deepwater exploration activities.
“This licensing round was the first to be held in over 20 years. The opening of offshore areas for investment has become a major focus area for growing the country’s hydrocarbon sector. Prompted by recent successes and wider industry interest along the Atlantic margin, the Argentinean government may launch a second offshore round.
“Argentina has also recently introduced major reforms to adopt investor-friendly policy, which has improved the country’s attractiveness to investors. The fiscal regime that the new blocks will be licensed under offers some of the most competitive terms in the region. However, budgetary pressures and the upcoming general elections in October 2019 cast uncertainty over whether these policies will continue beyond the short term.”