Challenger Energy has secured approval from Uruguay’s state-owned oil company and regulator, Ancap, for its farm-out agreement with Chevron regarding the AREA OFF-1 licence. Originally announced in March 2024, the deal was subject to regulatory consent, which has now been granted. Chevron will assume the role of block operator with a 60% stake, while CEG Uruguay retains a 40% non-operating interest.
As part of this transaction, Chevron will provide Challenger Energy with a payment of US$12.5 million once the deal is finalised. Eytan Uliel, Challenger Energy’s CEO, stated that the company had been navigating various regulatory processes and expressed relief at having received the final key approval.
The final steps include informing the Uruguayan Ministry of Industry, Energy and Mining, as well as registering the agreement with the Ministry of Economy and Finance. This stage involves a 20-day notification period. Uliel has indicated that the company expects to complete the entire process within four to eight weeks, expressing confidence that no significant delays would occur.
Once the procedural requirements are fulfilled, Chevron will proceed with plans to accelerate 3D seismic acquisition, with a goal of starting this work by early 2025. The AREA OFF-1 block, located approximately 100 km offshore Uruguay, covers about 14,557 km². Challenger was granted this licence in June 2020, and the first four-year exploration phase began on 25 August 2022, with Challenger meeting its minimum work obligations by the end of 2023.
Challenger Energy Group plc (LON:CEG) is a Caribbean and Atlantic margin focused oil and gas company, with a range of petroleum assets located onshore in Trinidad and Tobago, and Suriname, and offshore in the waters of The Bahamas and Uruguay.
