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From Digital Look

Mexico will continue opening up further oil and gas exploration blocks at pace, including onshore and deepwater prospects, to international and private sector players, according to a senior official.

Speaking at the IRN Oil & Gas International Licensing Summit 2015 in London, Lourdes Melgar, Deputy Secretary of Energy for Hyrdocarbons in Mexico, said: “The process is about balancing risk and return as we go past the initial stages of liberalisation of the sector. Mexico is seeing diversity in terms of industry participants who are coming forward.

“Bidding for 25 mature onshore fields in Nuevo Leon, Tamaulipas, Veracruz, Tabasco and Chiapas areas is on the horizon. As is deepwater offshore exploration in Perdido Area and Salina Basin prospects, with the latter aimed at extracting extra heavy oil.”

In 2014, Mexico altered its constitution to give international and private sector oil and gas companies the rights to explore on its territory, reversing a banning order dating back to 1938.

While the initial round was not hugely successful, contract awards for three shallow wells in its wake, concluded on 30 September, saw better interest with BP-controlled Pan American Energy and US independent Fieldwood among the winning bidders.

Melgar said the Mexican government would forge ahead with bringing about “profound change” in the country’s oil and gas sector breaking the monopoly of state-owned PEMEX.

“The government has issued a five-year plan for exploration and production with sustainability at the forefront of all considerations and industry-wide consultation. The word ‘sustainability’ was exclusively inserted in our framework for constitutional change.”

For a country that often grapples with corruption, Melgar also promised “unprecedented levels of transparency” in terms of bidding processes and procedures, as well as derived incomes and proceeds of the oil and gas bids, to garner “public, corporate and institutional investor” confidence.