MANAGUA, March 5 - Nicaragua signed a contract with U.S. company Infinity Energy Resources on Thursday to explore for oil off the country's Caribbean coast after overcoming legal objections from regional indigenous groups.
The Texas-based company will invest $30 million in exploration projects at two different sites in the poor Central American nation which currently produces no oil, energy minister Emilio Rappaccioli said at a news conference.
"I hope we too will have oil, regardless of what the prices are," Rappaccioli told reporters.
The firm can explore the 2,500 square mile (4,000 square kilometer) areas, both about 40 miles (60 kilometers) off Nicaragua's east coast, for 6 years. If the company strikes oil it can produce for 30 years, according to the contract.
The leftist government of Daniel Ortega signed a similar deal in April of last year with a unit of U.S. oil company MKJ Xploration.
Nicaragua tried to close the oil deals during the administration of Ortega's predecessor Enrique Bolanos, but the agreements were stalled in court after two autonomous regional councils claimed they had not been properly consulted first.
The area is populated mostly by blacks and Miskito Indians -- among the poorest people in Central America. The councils feared oil exploration could hurt the local fishing and tourism industries, but eventually agreed to authorize the plans.
Like most of Central America, Nicaragua is dependent on costly fuel imports and would benefit enormously from the discovery of domestic oil fields, government official Javier Chamorro said.
The Texas-based company will invest $30 million in exploration projects at two different sites in the poor Central American nation which currently produces no oil, energy minister Emilio Rappaccioli said at a news conference.
"I hope we too will have oil, regardless of what the prices are," Rappaccioli told reporters.
The firm can explore the 2,500 square mile (4,000 square kilometer) areas, both about 40 miles (60 kilometers) off Nicaragua's east coast, for 6 years. If the company strikes oil it can produce for 30 years, according to the contract.
The leftist government of Daniel Ortega signed a similar deal in April of last year with a unit of U.S. oil company MKJ Xploration.
Nicaragua tried to close the oil deals during the administration of Ortega's predecessor Enrique Bolanos, but the agreements were stalled in court after two autonomous regional councils claimed they had not been properly consulted first.
The area is populated mostly by blacks and Miskito Indians -- among the poorest people in Central America. The councils feared oil exploration could hurt the local fishing and tourism industries, but eventually agreed to authorize the plans.
Like most of Central America, Nicaragua is dependent on costly fuel imports and would benefit enormously from the discovery of domestic oil fields, government official Javier Chamorro said.
