Mexico’s Oil and Gas Privatization
As part of Mexico’s goal to revitalize its oil and gas production, the Secretaria de Energia (SENER) issued a five-year, four-round tender plan (2015-2019) for the denationalization of 914 oil and gas blocks, of which round 2.2 is a part.
Last week Mexican regulators signed off on the final six contracts of its first onshore public bid round, which went to bidders next in line after original winners failed to submit necessary guarantees.
The Mexican government also announced the second bid of Round 2 on August 23, 2016. This will be the seventh upstream bid round in Mexico since passage of the energy reform in mid-2014, according to a new report by international energy law powerhouse Haynes and Boone.
“The new bid round (named Round 2.2), comprises 12 onshore blocks for exploration in the Burgos and Southeastern Basins, covering collectively 5,006 km2 , with prospective resources of approximately 643.2 million barrels of crude equivalent and an original volume of approximately 93.2 million barrels of crude equivalent,” according to the Haynes and Boone report.
Term of the contract is 30 years from the date of execution of the contract. The term of the contract may be extended for two additional terms of five years each, for a maximum total of 40 years, according to Haynes and Boone.
Abbreviated Timeline
Sept. 5, 2016-Dec. 8, 2016: bidder requests prequalification meeting and pays registration fee of $750,000
Oct. 5, 2016-April 4, 2017: bidder gains access to data room
Dec. 19, 2016-Dec. 23, 2016: bidder delivers prequalification documents
March 8, 2017: list of prequalified bidders is published
April 5, 2017: bids are submitted, opened, and awarded
