Amoco and Bridas in strategic alliance in Southern Cone

Oct 20, 1997 02:00 AM

Sept. 5, 1997 Amoco Argentina Oil Company and Bridas Corporation announced today their strategic alliance in the Southern Cone of South America.
The new energy company with its strategic holdings in key oil and natural gas basins will be well positioned for significant growth across the energy sector in the Southern Cone region (Argentina, Bolivia, Brazil, Chile, Paraguay, Peru and Uruguay).
The diversified enterprise will be formed, pending definitive agreements, by contributing the respective assets of Amoco and Bridas in the Southern Cone and will create the second largest producer of oil and gas in Argentina. Amoco will hold 60 % interest and Bridas 40 % interest. As part of the deal, Bridas Corporation will acquire a minority interest in Amoco Bolivia Oil and Gas, which owns 50% of Empresa Petrolera Chaco S.A.
In this transaction, Amoco is represented by Morgan Stanley & Co. Bridas is represented by Chase Securities, a subsidiary of the Chase Manhattan Bank.
The deal includes about 1.5 billion barrels of oil equivalent of certified reserves, of which about half are proved, and daily production of over 140,000 barrels of oil equivalent.
"We are combining two highly successful regional energy players to create an even stronger entity that will aggressively compete for additional growth opportunities in the Southern Cone, one of the most exciting emerging energy markets in the world," said L. Richard Flury, Executive Vice President of Amoco Corporation responsible for the world-wide exploration and production business.
Alejandro Bulgheroni, Chairman of Bridas' Southern Cone subsidiaries will be the Chairman of the new company, and Amoco will name the Chief Executive Officer.
Bridas has significant natural gas assets in all key Argentine basins currently supplying the Argentine and Chilean markets. The size and positioning of these assets offer significant growth potential and the unique possibility to supply developing natural gas and electric power markets throughout the Southern Cone. In addition, Amoco's Cerro Dragon area and its presence in Bolivia are also considered key assets that will help both companies reach a relevant position in the Southern Cone energy market, especially Brazil. Combining the assets will also allow Amoco and Bridas to capture greater efficiencies and reduce overall operating costs to better compete in the region.
The new company is committed to maintaining a safe workplace for employees and operating in an environmentally sensitive manner.
Bridas Corporation is one of the leading international independent oil and gas enterprises. Bridas has successfully operated in Argentina since 1959 and is currently also operating in Central Asia, the United States and other countries of South America.

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