All Set for Mexico’s Round 2.1
October 5, 2017
The National Hydrocarbons Commission (CNH) signed new exploration and production contracts with the winning companies of Round 2.1.
The entity signed 10 E&P contracts, which represent investments of US$8.2B and have a duration of 30 years, with two possible extensions of five years.
Companies will work under the mode of shared production.
The Commission pointed out that the assigned areas sum to 5,872km² in total, and blocks could have resources of up to 2.4Bbl.
CNH’s president Juan Carlos Zepeda, said that the companies will have a period of 180 days to submit their exploration plans, and Energy Secretary (Sener) Pedro Joaquín Coldwell added that that this is yet another Energy Reform success.
He said that these agreements will create 82,000 direct and indirect jobs, and contracts could have a production up to 170mbd, not to mention that the State will receive between 77% and 83% of the profits of these projects that will take place in the states of Veracruz, Tabasco and Tamaulipas.
Some of the companies that will develop the projects are: Colombia’s Ecopetrol (NYSE: EC), Germany’s DEA Deutsche Erdoel, Malaysia’s PC Carigali, Italy’s ENI, UK’s Capricorn, Mexico’s Citla, Holand’s Shell (LON: RDSB) and France’s Total (NYSE: TOT), among others.
Zepeda said that the ENI and Citla consortium deposited a US$30M tie-breaking bond, to win one block to the Mexican Petroleum Fund.
Pemex’s CEO José Antonio Gonzalez said also spoke about Energy Reform and said that with a business plan that focuses on profitability, the NOC (National Oil Company) achieved stable profits that amount to US$38.2M.
He added that when it comes to alliances, the NOC is not only willing, but more than interested in having the best partners, and with this be more efficient and competitive.
Bottom-Line: The Mexican oil sector continues to grow and add new top global participants to develop E&P (exploration and production) projects in the country.
Pemex has participation in some contracts and the agreements will help it recover its metrics, but this will not happen from one day to another.
However, things like this show that Mexican authorities are on the right track to boost the national oil sector.