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Mexico fights back with Round Two

发布时间:2016年08月23日 19:40


Tender terms for the second bid round have been sweetened to ensure a high turnout, writes Alex Manda

WHAT: The bid round could attract up to US$11 billion in investment.

WHY: There are 15 blocks on offer, which contain a mix of production and exploration assets.

WHAT NEXT: Round 2.1 is due to close in March 2017.

Mexico has launched its second round of tenders for shallow-water acreage in the Gulf of Mexico. The terms available for the 15 blocks on offer will be sweetened to ensure a better turnout than the first round that was held in mid-2015.

The authorities have forecast that the new bid round could attract up to US$11 billion in investment, with typical spending of around US$750 million per block. The acreage holds a combined estimated resource of 1.6 billion barrels of oil equivalent, though this is original oil and gas in situ rather than proven reserves.

Such spending levels would be a major win for the Mexican authorities given the relatively lacklustre response to the inaugural Round One tenders. A small number of the almost 50 blocks that were offered received no bids, though interest did perk up after a slow start, and in spite of low oil prices.

The fourth package of Round One – known as Round 1.4 – for deepwater acreage in the Gulf of Mexico is due to be held in December. The government has high hopes for the auction and believes deepwater fields could turn around the country’s waning oil production. NewsBase Research (NBR) has forecast output of up to 1 million barrels per day from Mexico’s deepwater acreage by 2030.

Easier terms

Launching Round 2.1 the Mexican Energy Ministry said it had sought industry feedback from last year’s round and had improved some of the key bidding terms as a result.

The blocks on offer will be larger in terms of potential reserves and will also contain a mix of producing assets and explorable reserves. In Round One, productive assets and reserves for exploration were separated. Mexico’s upstream regulator, the National Hydrocarbons Commission (CNH), hopes this will entice firms that were previously put off exploration contracts by concerns over short-term income.

In addition, participants will be allowed to place bids in up to four different joint venture structures on each asset. At the start of Round One, Mexico had sought to ensure that each company only bid once on each asset to maximise the number of potential bidders. But restrictions on type and structure have been loosened in stages since then, though only companies that had experience in any of the iterations of Round One can participate in Round 2.1.

The new auction will include blocks and fields that were offered in Round 1.1 but which did not attract any bids. They will be re-tendered strong textwith improved terms.

The CNH said the contracts would have an initial duration of 30 years, with two possible five-year extensions.

There are also a large number of small-scale changes designed to make the fields on offer more appealing to investors. Bidders now have 120 days, rather than 90, to begin work at the sites they have won via tender. Deposits required from winning bidders will now be smaller and paid in stages in step with the exploration and development work that operators commit to in their development plans.

National content requirements have also been reduced in the short term, rising in stages from 15% during the exploration phase to 26% in the first year of development, and reaching 35% by 2025.

Low risk fields

The tender mostly targets lower risk fields. Eight of the 15 are close to the coast of Tabasco and Campeche. Pemex, which held a monopoly on exploration and production from 1938 until last year, became an expert on shallow-water production and set up substantial production infrastructure in the ports and waters off the two states.

One is close to Veracruz, which has less infrastructure but remains well served. Four blocks are close to the coast of Tamaulipas, which hosts some fields and infrastructure, but not on the scale of its neighbours to the south.

Blocks 6 to 12, which face the Tabasco coast, all hold light oil, Mexico’s most valuable hydrocarbon asset class. Blocks 1 to 4, close to Tamaulipas, contain a mix of light oil and wet gas. Block 5, close to Veracruz, is part of a geological formation that hosts deepwater natural gas fields further away from the coast. These include Lakach, Pilkis and Kunah. Blocks 13 and 14 contain the sort of heavy oil that comprises most of Mexico’s exports. And Block 15, the outlier close to Campeche, holds wet gas.

Ministry data, which will be made available through regulators, include sixteen 2-D seismic studies and eleven 3-D studies. The amount of data is about to expand substantially, however. There are currently nine 2-D and one 3-D seismic studies under way, data from three existing studies are being reprocessed with new technology and there are also sonar, geochemical and aeromagnetic studies being carried out.

The revised tender terms have been welcomed by global institutions. Alejandro Werner, director of the International Monetary Fund’s (IMF) western hemisphere department, said: “Pemex needs to adjust to the new reality of low oil prices, and the changes announced thus far show that this is taking place.”

Enhanced bidding terms that are designed to draw in more non-Pemex investment suggest the Mexican government is taking the necessary steps to reduce the role played by the state-run giant. And the fact that the companies Pemex is competing with helped design the new tender’s terms is a positive sign of progress in the reform process.

Companies that have registered for the process will be able access the data room from August 1 until December 2. There will be four rounds of questions and answers beginning immediately and running until March 3, 2017. Firms will be able to buy access to the process formally from December 15, 2016, and the CNH will begin shortlisting on January 6, 2017 and publish the list by March 1. Shortlisted companies must present sealed bids by March 22 and the CNH will chose by March 24. Contracts must then be signed within 90 days.

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