Canada-based Pacific Rubiales Energy has entered into a $335m agreement with BPZ Resources to gain a 49% participating interest in Block Z-1 in offshore Peru.

Under the terms of the agreement, Pacific Rubiales will pay $150m in cash and is committed to pay $185m for BPZ’s share of capital and exploration expenditure in the block.

Pacific Rubiales chief executive officer Ronald Pantin said: "These are oil-weighted assets with excellent running room to expand production, in a country that we see a lot of opportunity."

The acquisition also includes the developed and producing Corvina and Albacora oilfields, located in the offshore Tumbes basin in depths ranging 200ft-1,000ft.

Other assets include undeveloped prospects namely, Piedra Redonda, Barracuda, Delfin, as well as eight exploration leads and existing production facilities, infrastructure and development projects.

The farm-in deal remains subject to approval from Peru authorities.

BPZ currently holds a 100% working interest and is operator under the licence of the block.