MONTEVIDEO, Uruguay, Oct. 6 (UPI) -- Uruguay is set to become a major exporter of natural gas after assessments indicated it has potentially large and commercially viable gas deposits on its territory.
The news took some analysts by surprise as Uruguay was expected to follow the pattern of recent hydrocarbons discoveries offshore in other Latin American countries, particularly Brazil. Further oil and gas discoveries offshore haven't been discounted by Uruguay.
The latest confirmation was cited in reports from the U.S. Energy Information Administration and U.S. geological studies published in the Uruguayan media.
Reports of large onshore gas finds have circulated since former President Tabare Vazquez announced a major gas find on his official Web site in June 2008. The field was about 93 miles off Uruguay's Atlantic coast near the city of Punta del Este.
Investigations for commercially exploitable gas deposits have involved both domestic and foreign companies.
The EIA estimated the potential of Uruguay's recoverable natural gas reserves at 20,580 billion cubic feet, likely to be the sixth largest in the region.
U.S. geological findings cited by Uruguayan media quoted varying figures plus the possibility the ongoing exploration could yield oil deposits as well.
Reports based on seismic studies suggested Uruguay's north basin, adjacent to Brazil, among areas likely to yield both oil and gas.
The U.S. Schuepbach Energy LLC, which has headquarters in Dallas, is among foreign companies involved with Uruguay's energy development. Schuepbach Energy has been surveying the north basin on a two-year contract with Uruguay's state-owned Administracion Nacional de Combustibles, Alcoholes y Portland.
Created in 1931, ANCAP is engaged in the exploration, production, transport, refinery, storage and sale of hydrocarbons and derivatives. The firm is also active in the petrochemicals, biofuels and portland cement industries.
Brazil's Petrobras, Argentina's YPF and Portugal's GAL are already active in Uruguay's energy sector.
Schuepbach's contract with ANCAP expires this month but the state energy company plans to begin exploratory drilling in the area in 2012.
ANCAP officials declined immediate comment on the latest gas deposits estimates, saying they would wait for further scientific studies. However, earlier Argentine scientific surveys also confirmed the finds.
Meanwhile, Uruguay is going ahead with further offshore exploration that is seen likely to result in more oil and gas finds.
Another offshore oil and gas licensing round is due this year and has drawn interest from foreign prospecting and investment companies. Uruguayan President Jose Mujica has outlined plans to make Uruguay self-sufficient in energy and increase its export potential.