Condor Energy Clears Perupetro Qualification as Licence Talks Open Offshore Peru
Key Takeaways
- Perupetro has formally qualified Condor to assume a 100% interest in a licence contract for offshore Block Z-72, clearing a required step toward licence award.
- Condor now moves from exclusive negotiating rights under TEA LXXXVI to direct negotiations on licence terms, with community consultation running alongside.
- No licence has been awarded, no timeline has been given, and execution remains subject to final terms and government approvals.
- The 4,858km2 block carries 1 Tcf of Contingent gas at Piedra Redonda and over 3.3 billion barrels of unrisked Prospective oil resources, including an internal Raya West estimate.
- Condor is in talks with unnamed potential strategic partners and gas customers, while Anadarko plans an exploration well offshore northern Peru in 2027.
Condor Energy receives formal Perupetro qualification for offshore Block Z-72
Condor Energy (ASX: CND) has received formal qualification from PERUPETRO S.A., Peru’s state-owned agency responsible for negotiating and administering oil and gas contracts. The Perupetro qualification is described as a key step towards securing a full exploration and exploitation licence in Peru.
The qualification confirms Condor’s eligibility to assume the obligations associated with a 100% interest in a Licence Contract for the Exploration and Exploitation of Hydrocarbons in offshore Block Z-72, north of Peru. It is a required step in the process to formal licence award.
Z-72 is the offshore designation, used by Perupetro, for the proposed licence contract. The qualification relates to exercising a first option of the Technical Evaluation Agreement (TEA).
For investors, this matters because Condor now moves from holding exclusive negotiating rights to direct negotiations with the state agency. The key takeaways:
- Condor received formal qualification from Perupetro, demonstrating the legal, financial and technical capability to meet obligations under the proposed licence contract.
- The qualification relates to exercising a first option of the TEA to a proposed exploration and exploitation licence contract, identified by Perupetro as offshore Block Z-72.
- Condor will now progress to direct negotiations with PERUPETRO on the licence contract terms, ahead of seeking final government approvals.
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What the qualification means: from TEA to licence contract
What is a Technical Evaluation Agreement?
A TEA is an oil and gas contract that provides the holder with the “exclusive right to negotiate a Licence Contract over the TEA area.”
Think of qualification as the gate between the two stages. Perupetro assessed Condor’s legal, financial and technical capabilities under Peru’s qualification process, and that approval now lets the licence negotiation proceed.
Next steps to licence award
The announcement points to the following sequence:
- Direct negotiations with PERUPETRO on the Exploration and Exploitation Licence Contract terms.
- Community consultation, running alongside the negotiations.
- Agreement on final terms.
- The required government approvals.
Execution remains subject to agreement on final terms and the required government approvals. The announcement does not disclose a timeline, so you should treat the path to a signed licence as open-ended for now.
Director quote
Serge Hayon, Managing Director
“…Progressing towards a full licence contract is central to establishing the long-term contractual basis for investment and development. This qualification advances that process, as we continue discussions with potential strategic partners and gas customers.”
Hayon also pointed to “Anadarko’s planned exploration well offshore northern Peru in 2027”, which he said “highlights continued industry investment in the region.”
The asset behind the approval: Tumbes Basin TEA LXXXVI
In August 2023, Condor and its partner Jaguar Exploration, Inc. (Jaguar) entered into the 4,858km2 TEA LXXXVI offshore Peru with Perupetro. Condor is the 100% holder of the TEA.
The area covers almost all of the Peruvian offshore Tumbes Basin, in water depths of between 50m and 1,500m. The block is under-explored and surrounded by multiple historic and currently producing oil and gas fields.
| Resource type | Estimate | Basis | Note |
|---|---|---|---|
| Piedra Redonda gas field (Contingent Resources) | 1 Tcf natural gas | “Best Estimate”, 100% gross | Undeveloped shallow water gas field |
| Prospective Resources across Bonito, Raya, Salmon, Caballa and Tiburon prospect areas | 3 billion barrels of oil | Combined best estimate gross unrisked 2U | Independent assessment by NSAI |
| Total Prospective Resources including Raya West Prospect | Now exceed 3.3 billion barrels | Total best estimate unrisked 2U | Raya West estimated internally by Condor, not NSAI |
Not all of these figures carry the same weight. Prospective Resources are estimated quantities of petroleum that may potentially be recovered from undiscovered accumulations, and they carry both a risk of discovery and a risk of development. Further exploration, appraisal and evaluation are required to determine the existence of a significant quantity of potentially recoverable hydrocarbons.
Contingent Resources, such as those at Piedra Redonda, are potentially recoverable quantities from known accumulations that are not yet considered commercially recoverable due to one or more contingencies. Neither category should be read as reserves.
The source also includes a map (Figure 1) of TEA LXXXVI, its leads and prospects, and the Piedra Redonda gas discovery.
For readers wanting to see how the internally estimated Raya West figure lifted total Prospective Resources beyond 3.3 billion barrels, our detailed coverage of the Raya West discovery sets out how the new prospect fits alongside the NSAI-assessed areas.
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Investment significance and what comes next
The qualification clears a required step on the path to a formal licence, which addresses part of the regulatory pathway. Management has said it believes Condor’s gas commercialisation and oil exploration strategy has a clear role to play, given energy security and reliable domestic supply remain national priorities.
Importantly, no licence has been awarded and no partner has been announced. Condor says it continues discussions with potential strategic partners and gas customers, though the announcement names none.
Milestones to watch:
- Negotiation of the licence contract terms with PERUPETRO.
- The required government approvals.
- Progress in discussions with potential strategic partners and gas customers.
Until those steps land, the resource estimates above remain exactly that: estimates, with execution of any licence contract subject to final terms and government approvals.
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