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Barclays: $70 More Likely Than $100

Barclays: $70 More Likely Than $100

While there have been plenty…

EIA Inventory Count Accelerates Oil Price Slide

EIA Inventory Count Accelerates Oil Price Slide

Oil prices continued to slide…

Mexico Invites Big Oil To Propose Offshore Blocks For Development

Offshore

Mexico will be happy to receive suggestions for offshore blocks to be included in the December bidding round for its section of the Gulf of Mexico, the country’s deputy energy minister said yesterday at an event in Houston.

Speaking at the opening of the Offshore Technology Conference, Aldo Flores Quiroga added that oil companies have another six weeks to nominate blocks they’d like to bid for.

The nomination window opened in mid-March. The final tally of blocks that the ministry will tender at the end of the year will be made public in June.

The tender, and the nominations process is part of Mexico’s energy market liberalization efforts aimed at stimulating fresh investment in its oil industry and breaking down the monopolistic status of local state-owned oil and gas major Pemex.

All the blocks to be tendered will span 1,000 sq km – a block size standardization effort on the part of the government.

The December tender will be the second offshore one that Mexico organizes since it began liberalizing its energy industry back in 2013. The first, last December, saw eight of ten blocks awarded to various consortia, including major international participants such as BP, Shell, Chevron, and Statoil, along with China’s CNOOC.

Related: ‘’OPEC Has Failed’’

In addition, the government is offering international energy companies farm-out agreements for the development of other offshore blocks. Australia’s mining and energy giant BHP Billiton became the first to strike such a deal, for $62.4 million. BHP will develop the Trion offshore block in partnership with Pemex. Another two offshore fields, mature ones on land, will be farmed out later this year.

At the end of last year, Mexico said it planned to increase its crude oil production substantially, overtaking Brazil if its plans work out. As of December 2016, Mexico was the fourth-largest oil producer in the Americas, according to the EIA, behind the US, Canada, and Brazil.

By Irina Slav for Oilprice.com

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