Southern Hemisphere Offers Prospective and Challenging Opportunities

This article appeared in Vol. 10, No. 4 - 2013


New Zealand

Energy and Resources Minister Simon Bridges has opened the government’s Block Offer 2013 comprising 189,000 km2 offshore and over 1,500 km2 onshore. These include three defined onshore blocks in Taranaki, and two on the East Coast of the North Island, together with three offshore release areas in the Reinga-Northland, Taranaki and Great South-Canterbury Basins. Permits awarded will be governed by the new Crown Minerals Act regime which came into force on May 24, 2013, which provides for a significantly improved and streamlined two-tier system for permit management. Companies will have until September 26 to submit work program-based bids for their preferred blocks.

Separately, the New Zealand government invites nominations of areas of interest to be included in Block Offer 2014, or any other future offer.


Perupetro has opened an International Bidding Round for the hydrocarbon exploration and exploitation of nine offshore blocks, which the regulator hopes will generate a minimum investment of US$450 million. The blocks are distributed through the Salaverry-Trujillo, Lima, Lima-Pisco and Mollendo Basins and all are 10 km from the coast. Luis Ortigas, Chairman of the Board of Perupetro, said the offshore basins have good quality seismic information to define the sedimentary sequences, together with regional geochemistry and seismic stratigraphy research data. Petroperu will not participate in the exploration stages in the awarded blocks, but has the option of a 25% back-in in the event of a commercial discovery.

This round constitutes a significant change of plan by the company, which last September issued a statement that before the end of 2012, 36 new concessions would be established, the majority of which would be in the Amazon. The change is a result of the 2011 prior consultation law, which gives a voice to the indigenous tribes on projects affecting the collective rights to their quality of life, cultural identity or physical existence.

Sri Lanka

The Petroleum Resources Development Secretariat (PRDS) launched the Second Offshore Licensing Round (SL 2013-01) on March 7, 2013, comprising a total of 13 blocks in the Cauvery and Mannar Basins. The blocks in the Mannar Basin range in size from 2,714 km2 to 8,120 km2 in the deep to very deep waters of the Gulf of Mannar, while the Cauvery Basin blocks range from 2,403 km2 in the shallow waters of the Palk Straight, to 4,566 km2 in the deepwater to the north-east of Sri Lanka. Interested companies are required to submit bids by November 30, 2013 (revised from September 30). Successful companies will secure licenses with an eight-year exploration period divided into three consecutive phases of three, two and three years respectively.

Exploration efforts have generally focused on the onshore and shallow-water Cauvery Basin resulting in the discovery of oil and gas fields. The Mannar Basin is underexplored with only four exploration and three stratigraphic wells, all of which are situated on the north-eastern shallow continental shelf of Sri Lanka. No deepwater drilling has occurred to date. Seeps reported in the basin indicate the presence of an active petroleum system with expected source rocks similar to those found in the Cauvery Basin.


Tanzania plans to launch an oil and gas exploration licensing round on October 25, 2013, offering seven offshore blocks in water depths of between 2,000m and 3,000m, plus one onshore block. The round will close on May 15, 2014. The average size of the blocks is 3,000 km2, except the North Lake Tanganyika block, which is believed to be about 9,700 km2. This round was initially announced in April 2012, with an intended closing date of April/May 2013, but it was postponed due to technical reasons and a desire by Tanzania’s Ministry of Energy and Minerals to present a new Natural Gas Policy in the October 2012 Parliamentary session. The government is keen to remain competitive with neighboring countries.

When the round was first announced in April 2012, nine blocks were offered, but the delay has allowed the Tanzanian government to reassess the available acreage and, as a result, they have removed two blocks (4/1B and 4/1C) from the auction process, reserving them for Tanzania Petroleum Development Corporation (TPDC). The round is structured by the Petroleum (Exploration & Production) Act of 1980 and the Model Production Sharing Agreement (MPSA 2008) but TPDC has made it known that it will be introducing a competitive fiscal regime for deepwater operation in water depths ranging between 2,000 and 3,500m. 


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