International operators lining up for Mexico’s Round 3.1 auction
The first of three upstream auctions so far announced in Round Three of Mexico’s energy reform will be on Tuesday.
MEXICO CITY – The first of three upstream auctions so far announced in Round Three of Mexico’s energy reform will be on Tuesday. Round 3.1 will offer 35 blocks under production-sharing contracts in shallow waters of the southern Gulf of Mexico.
The blocks are divided into three sectors: the Burgos basin’s paleochannel (blocks 1-14); the Tampico-Misantla and Veracruz basins (blocks 15-27); and the Cuencas del Sureste (Southeast) basins (blocks 28-35).
Mexico’s National Hydrocarbons Commission (CNH) says that 36 companies from 14 nations have qualified to bid during the country’s next tender. The tender will mark the start of Mexico’s third round of tenders since the country decided in 2013 to open its energy sector to foreign investors.
Offshore blocks in Burgos, Mexico’s leading producer of non-associated natural gas, have never before been on offer under the reform. State-owned Petroleos Mexicanos (PEMEX) did some exploratory offshore development in Burgos decades ago, but without success.
The government expects Round 3.1 to attract about $3.8 billion of foreign investment, in addition to the $153 billion of rounds one and two. The prospective resources on offer are said to contain 9.87 Bboe in resources.
Chevron is reportedly the only US-based company among the bidders, which also include oil players Eni and Total along with ONGC Videsh and PEMEX, among others. The list of qualifying bidders, which comprise 14 individual companies and 22 as bidders in a consortium, will compete for rights to operate in 35 contractual areas. The shallow-water areas will be tendered as production-sharing contracts, according to CNH. Bids will be opened March 27.