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Nicaragua awards exploration
contracts to U.S. energy firm |
The Nicaraguan government has awarded two exploration and production contracts to U.S.-based MKJ Exploraciones Internacionales S.A., which will search for oil and gas in the Caribbean, the company said.
The six-year contracts were signed Tuesday by Attorney General Hernán Estrada and MKJ chief Eric Conrad.
MKJ, a unit of Louisiana-based MKJ Xploration, will look for oil in two areas of the Caribbean shelf, one located some 120 kilometers (74 miles) east-southeast of Puerto Cabezas, capital of the Caribe norte region, and the other 170 kilometers (105 miles) northeast of Bluefields, the capital of the Caribe sur.
The two areas cover a combined 800,000 hectares (1.97 million acres), or nearly 8,000 square kilometers (3,088 square miles).
If the U.S. company finds commercially viable reserves, it will have the right to produce oil and gas for 30 years.
Under the contract terms, MKJ will pay a 15% royalty to the Nicaraguan central government and the Caribbean regional autonomous governments.
MKJ will also pay a 30% tax on its profits to the Nicaraguan state and 3% for environmental protection, health, education and infrastructure development projects in Caribbean communities.
Conrad said the project's first phase, which will last for about a year and involve seismic studies, will require investment of $5 million to $10 million.
The second phase, when drilling will take place, is expected to cost $25 million to $50 million and take one to three years to complete. |
-EFE |
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