(Energy Analytics Institute, Aaron Simonsky, 19.Mar.2019) — Argentina’s Mendoza province plans to launch a tender in May for at least five oil areas with aim to attract investments of $70 million to boost falling production, which last year registered the worst decline in the past decade.
The province, which attracted investments of around $110 million in 2018, plans to announce winning bid details in September, reported online media Econojournal on March 19.
The fields to be offered include Sierra Azul Sur, Cerro Chaparro, Boleadero, Atuel Norte and Loma el Divisadero, Econojournal said, citing details from provincial hydrocarbons director Santiago Fernandez, who didn’t rule out the possibility of adding other areas to the auction.
An estimated 85% of Mendoza’s oil production is attributed to state oil company YPF. This year’s tender aims to attract more players and reverse the province’s declining production trend over the short and medium terms, Fernandez said. The province is also considering reducing royalties to boost investments.
“We have no problems reducing oil royalties as long as that brings more investments and more work in the sector,” Fernandez said.
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