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Brief history of the country
Paraguay (the Republic of Paraguay) is a landlocked country bordered by Argentina to the south, Brazil to the east, and Bolivia to the north. It is sometimes referred to as the Heart of South America.
Guaraní semi-nomadic tribes were living in the area for thousands of years before Spanish explorers visited in 1516 and settled in 1537, introducing Christianity. However, it was always a peripheral colony of the Spanish Empire with a small population. Guaraní culture in a very mixed race society still remains influential.
Gaining independence from Spain in 1811 (unofficial until 1842), the country was ruled by a series of dictators with protectionist policies. In 1864 it waged a war against Brazil, Argentina and Uruguay and had been massively defeated by 1870. The war reduced the population dramatically and substantial lands were ceded to Argentina and Brazil.
Through the 20th century unstable military dictatorships continued although it did win a 3-year war with Bolivia (the Chaco War) in 1935. In 1989 the last dictator was overthrown and free multi-party elections were held in 1993.
With its agriculture and minerals export economy, Paraguay has recently experienced rapid economic expansion.
Oil and gas summary
Paraguay is one of two land-locked countries in South America, the other being Bolivia. It is divided by the Paraguay River into two geographic regions, the eastern Región Oriental and the western Región Occidental also known as the Chaco.
The country has 5 sedimentary basins but no production. The Carandayty and Curupayty sub-basins extend from Bolivia where they produce gas (Chaco basin). The Pirity and Pilar sub-basins extend from Argentina where they have analogies with the productive Olmedo basin (also called Chaco).
The Parana basin runs from Brazil, through Paraguay into Argentina and Uruguay and has some gas finds in Brazil.
Over 50 exploratory wells have been drilled over the years, many in the early 1970s. Small companies still regularly evaluate the prospects of these basins.
There has been no successful drilling although oil shows have been often reported. Globalshift does not forecast any commercial oil or gas production in the short or medium term.
The country is also a producer of electricity owing to its stakes in the Itaipu, Acaray, and Yacyreta hydroelectric dams. It exports electricity to Brazil and Argentina.
PARAGUAY
Map and National Flag
SOUTH AMERICA
Bamboo avenue
South America
Capital
Population
Land area (sq kms)
Oil prod (000s b/d)
Gas prod (bcm/yr)
Oil cons (000s b/d)
Gas cons (bcm/yr)
Asuncion
6.4 mm
406,752
None
None
28
None
Government
Paraguay is a representative democratic republic with a multi-party system and separation of powers into 3 branches.
Executive power is exercised by the President, who is head of state. Legislative power is vested in 2 chambers of the National Congress.
Petróleos Paraguayos (Petropar) is the NOC with a monopoly on all petroleum product sales and imports. It operates the country’s only refinery at Villa Elisa.
Geology and History of Exploration
Land-locked Paraguay lies geologically at the border between several basement regions. East of the Paraguay River crystalline basement crops out mainly in the heights of Caapucú and Apa. The Caapucú High is the northwesternmost outcrop of the Río de la Plata Craton. The Apa High is the southernmost outcrop of the Central Brazilian Shield.
Between these shield areas Paraguay has 5 sedimentary basins and sub-basins. The Chaco Basin, making up 60% of the country in the northwest is a foreland area that extends into Argentina and Bolivia where it borders the Andean thrust front. It is made up of 4 sub-basins in Paraguay.
The Carandaity and Curupaity sub-basins in the north are chiefly composed of Paleozoic sediments. They are depressions within the Chaco Basin which, in Bolivia, produce substantial volumes of gas.
The Pirity and Pilar sub-basins comprise Late Cretaceous and younger sediments separated from each other by the Asunción Anticline that roughly follows the path of the Paraguay river. They are depressions within Argentina’s Chaco Basin where, for over 70 years, oil and gas have been produced from the Olmeda sub-basin near the border with Paraguay. The Olmeda has the same geological formations and is regionally down dip of the Pirity.
The Parana basin is an intra-cratonic flexure running southwards from Brazil. About 75% is in Brazil, from Mato Grosso to Rio Grande do Sul states. The remainder is in eastern Paraguay, northeastern Argentina and northern Uruguay. The basin developed during the Paleozoic and Mesozoic and is filled with Ordovician to Cretaceous sediments. Gas finds have been made in these sediments in Brazil.
A little over 50 exploratory wells have been drilled in Paraguay and a number are reported to have contained shows of oil and/or gas. Given the similar geological settings to Bolivia and Argentina and the fact that much of the Paraguayan basin area is unexplored, Globalshift believes that there is potential for hydrocarbon discoveries, particularly in the north and west, although commerciality remains questionable.
History - Drilling activity in the country commenced in 1947 and activity has continued in phases up to the present day, mostly by small companies. The most intensive drilling occurred in the 1970s with the primary intent to find analogous fields to those in Bolivia and Argentina’s Chaco Basin, especially in the Pirity and Pilar sub-basins (which compare with the Olmeda sub-basin in Argentina).
No commercial discoveries have been made but several wells have had oil and/or gas shows. In 2014 President Petroleum reported that the Lapacho well in the Pirity Concession had discovered light oil. A total of a little over 50 exploratory wells have now been drilled in the country.
Although oil has been found in Paraguay, no commercial volumes have been discovered as yet. Thus Globalshift currently forecasts no oil or gas production from the country, at least in the short and medium term.