Eight months have passed since CNH successfully allocated eight out of 10 blocks in Mexico’s first deepwater bidding round, as well as the first farm-out for PEMEX with the Australian giant BHP Billiton in the Trion field, also in deepwater.
The winners of this tender, as well as PEMEX and BHP Billiton, will deliver their exploration plans to CNH in the first week of September. The plans will reveal the processes, the amount of time they expect it will take to find hydrocarbons in Mexico’s deepwaters, and the approximate total investment. The success of these new operators will open new business opportunities for the entire value chain of the Mexican oil industry.
The key factors for success are: technology, financial discipline and expected production platform. One main question is how actual market conditions will live up to the exploration ambitions of major deepwater players, and therefore what will be required of the local and international supply chain to meet these upcoming challenges.
The next deepwater bidding round (Round 2.4) will be held on Jan. 31, 2018. This bidding round covers exploration blocks in the following areas: Perdido, Cuenca Salina, Cordilleras Mexicanas and the Yucatan platform, this latter is the least-explored basin of the four contract areas in Mexico. Companies prequalified in Round 1.4 may qualify automatically for Round 2.4 as long as they maintain the same financial conditions, which will make the process simpler.
Mexico’s licensing rounds are positioning the country as a main investment destination for the coming years and deepwater represents a huge potential niche that will push companies to become more efficient in every aspect of their structure if they have ambitions to participate in the new segment.