Methanex Corporation announced its participation in the Tranquilo Exploration Block, located in southern Chile. Methanex's participation is part of a new ownership structure that involves both the Tranquilo and the Otway blocks.
Previously, Methanex announced it had acquired a 16% ownership in a consortium to develop the Otway Block only. In the new ownership structure for both exploration blocks, Pluspetrol Chile S.A. (Pluspetrol), Wintershall Chile Limitada (Wintershall), and GeoPark Magallanes Limitada (GeoPark), each have 25% participation, and International Finance Corporation, member of the World Bank Group (IFC) and Methanex Chile S.A. (Methanex), each have 12.5% participation. The objective of the restructuring was to create a stronger consortium with similar long-term objectives in the region. GeoPark will be the operator of both blocks. The arrangement is subject to approval of the Ministry of Energy in Chile.
Tranquilo and Otway represent large, attractive hydrocarbon exploration blocks totalling over 12,000 square kilometres. The consortium has approved the 2010 budgets for the two blocks, which total US$37 million and include 2D seismic surveys of 553 kilometres, 3D seismic surveys of 362 square kilometres and the drilling of three wells on the Tranquilo block.
Bruce Aitken, President and CEO of Methanex commented, "Participating in the Tranquilo Block represents another opportunity to increase gas supply to our plants in Chile. We are very pleased to be part of this new consortium of high-quality companies that bring both technical and financial strength to exploration activity in Southern Chile where our plants are located."
Paul Schiodtz, Methanex's Senior Vice President, Latin America added, "The improved structure for the Tranquilo and Otway blocks provides a more effective and aligned approach to their operation, so we consider our participation in this new consortium as a positive additional step to our strategic objective of accelerating and promoting natural gas development in southern Chile."
