Echo Energy has signed its first transaction in Bolivia following the group's recently announced onshore gas strategy across Latin America.
Echo said it had signed a binding joint evaluation agreement with Pluspetrol Bolivia Corporation SA which positioned the company to secure an 80% operated interest in the Huayco block in southern Bolvia.
Echo said: The Huayco block lies within the Tarija Basin, benefits from full 3D seismic coverage and, critically, the company internally estimates it has significant multi-Tcf gas potential.
"The block spans 75 square kilometres and is close to key export gas pipeline infrastructure which would connect any discovery to high value gas markets in Brazil and Argentina."
Echo said the agreement commenced with a technical evaluation after which, subject to the usual regulatory approvals, it would take an 80% operated position.
Pluspetrol currently holds a 100% operated position.
Echo said that while it would pay 100% of the first well (and 80% of the wells thereafter), the evaluation agreement only committed it to fund the agreed technical studies and as such no back costs or consideration was payable.
Echo said both companies viewed this as the start of a longer-term partnership in which other potential opportunities may be explored.
The company also confirmed it was close to securing other exploration and production assets in the region.