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Oil and gas news roundup: South America

South America is an exciting continent for the oil and gas industry, with new pockets of these natural resources being found frequently. From the discovery of shale gas in Venezuela to the increased potential for discovery in Brazil, firms from around the world are looking to start new ventures in this region as well as accelerating existing ones.

The latest news from South America includes the construction of a new pipeline that will see Colombian oil exported via Ecuador, as well as the announcement that Brazilian oil exports hit record levels in the last five months. Read on for more news from this continent:

Agreement signed for Ecuador-Colombia pipeline
A new pipeline that will join up the oil networks of Ecuador and Colombia is set to be constructed after two of the region's major petrochemicals firms signed an agreement to partner on the project. Amerisur Resources Plc and Petroamazonas EP will join their networks together, which will allow Colombia to export its oil via Ecuador.

Amerisur owns the Colombian portion of the network, while Petroamazonas will be constructing the link that will cross the Ecuadorian border. In return for letting Amerisur use its network, Petroamazonas is planning to charge a tariff of $1.09 a barrel. The two companies are committed to transporting a minimum of 5,000 barrels per day.

Amerisur chairman Giles Clarke said: "I want to congratulate the Amerisur team on this fundamentally important milestone for the company. As was the case with the Channel Tunnel, international bilateral infrastructure projects are often simple to conceive but incredibly complicated to make reality."

Shale gas found in Argentina
The Argentinian state energy firm, YPF, has announced the discovery of a new shale gas deposit in its Vaca Muerta field. Located in the southern province of Neuquen, the La Ribera x-1 well is around 90 km away from the region's capital.

In a statement, YPF said: "Initial results showed high gas productivity. The La Ribera x-1 well had initial productivity of 43,000 cubic m of gas per day with a thickness of 258 m." The firm added that the discovery indicated the high possibility that more gas would be discovered in Vaca Muerta in the near future.

Gazprom to bid for Brazilian oil and gas?
Eduardo Braga, Brazilian mines and energy minister, has announced that there will be a 13th round of bidding for the nation's oil and gas exploration areas. Companies will be able to bid for 266 exploration blocks, covering a total of 125,024 sq km, starting from July 7th.

One of the interested parties is reported to be Russia's state energy firm Gazprom. Shakarbek Osmonov, the firm's director for Brazil and Latin America, told Reuters that it is considering bidding on July 7th, as well as looking into offers for stakes in several fields that are being sold off by Brazil's state oil company, Petroleo Brasileiro SA.

The blocks up for bid are largely to be found in the onshore basins of Amazonas, Parnaiba, Reconcavo and Potiguar. A total of 182 are located here, with the remaining 84 to be found in the offshore basins of Sergipe-Alagoas, Jacuipe, Espirito Santo, Campos, Camamu-Almada and Pelotas.

Companies invited to farm into Norte Basin fields
It was recently found that Uruguay's Norte Basin region contains a huge amount of oil and natural gas, a discovery that has led many firms to look towards the nation as the next big thing in the industry.

Australian firm Petrel Energy Limited and its 51 per cent owned partner-operator Schuepbach Energy International - which is based in Dallas - have control of the Salto and Piedra Sola concessions in Norte Basin. The firms believe they have access to up to 87.8 billion cubic m of gas and 910 million barrels of oil, and are looking for farm-in partners to team up with on this venture.

David Casey, managing director of Petrel, said: "We are actively engaged with a number of parties who have expressed interest in participation in our Uruguayan concessions. We will continue to review all options to maximise shareholder value for this unique high-quality and high-impact asset."

Brazil triples oil exports to China
Brazil has announced that China is now the main buyer of its oil, after exports to the Asian nation tripled from January to May 2015. This is an increase of 80 per cent when compared to January-May 2014, and is also a record amount for the country.

Overall, in the first five months of 2015 Brazil exported 5.4 million tonnes of oil to China. This accounted for 35 per cent of Brazil's total exports for this period, as it shipped out around 15 million tonnes in total.

Brazil's state-owned oil company, Petrobras, has been attempting to improve relations with China for some time, and its success in this area has been a huge boost to Brazil's petrochemicals industry. China is now the largest consumer of Brazilian oil in the world. The country imports twice as much of the product from Brazil as the US does.

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