Mexico removes bidding limits for first oil tenders

The National Hydrocarbons Commission (CNH) of Mexico has decided to relax rules on bidding contracts and terms for the first oil tenders, expected on 15 July 2015. With the adoption of the energy reform in late 2013, Mexico ending the decades-long monopoly of state-owned oil company Pemex, and opening its oil and gas sector by allowing private companies to invest in the oil and gas exploration and production. For the first batch of tenders, the CNH has lifted the previous cap on the number of companies allowed to bid on and allowed companies seeking to operate fields as part of consortia to bid on additional contracts as individual companies. Under the new rules, operators will have to hold a minimum 1/3 stake in the field, while consortium partners may have a larger stake. The CNH has reversed a previous rule requiring companies to destroy geological data purchased for fields that are not awarded. Cost recovery rules have also been modified to allow companies to claim back a further 25% of costs during the exploration phase.

Final bidding terms and shallow water production-sharing contracts will be announced on 9 June 2015. So far, 34 companies have applied to pre-qualify to bid for 14 oil blocks in shallow water. 19 companies and seven groups have pre-qualified, including Chevron, ExxoMobil, Marathon, Nexen, Total, Statoil and Indian company OVL (ONGC Videsh Ltd). In addition to these 14 shallow-water blocks, the CNH also plans to auction 9 other shallow-water blocks in the Gulf of Mexico in September 2015 and 26 onshore blocks in December 2015.