Gasoline and natural gas price hikes are feeding Mexico’s inflation while the Attorney General Office is dealing with PEMEX’s complaints. Meanwhile, global oil production is set to ramp up in the 2018-19 horizon.
Ready to fuel up? Here’s your weekly news roundup:
Natural Gas and Gasoline push inflation to 4.65 percent in June. Increases in the gasoline, electricity and natural gas prices impacted directly Mexican’s purchasing power, by increasing the annual inflation rate to 4.65 percent.
Attorney General Office (PGR) investigates breach of contract case from service company. Between Apr. 23, 2013 and Dec. 18, 2015, PEMEX E&P awarded leasing contracts for five of its rigs to Primus, Laurus, Fortius, Decus and Impetus, subsidiary companies of Oro Negro Drilling, for US$1,100 million. To finance the contracts, Oro Negro emitted close to US$900 million in bonds, which Norsk Tillitsmann purchased. In Sept. 11, 2017, Oro Negro filed for bankruptcy, without paying the obligations due to the rig owners.
Repsol reaches new service station landmark. The Spanish oil company announced it now has 50 service stations operating throughout Mexico. The latest addition is located in Guadalajara.
PEMEX files complaint over employee imitators. The NOC reported a group of fraudulent fuel sellers offering below-market prices for gasoline impersonating PEMEX executives, which are never delivered.
Gasoline prices cumulate 11 months of price hikes. Compared to June 2017 average gasoline prices, Mexicans now fill their gas tanks with a price 15.8 percent higher in June 2018.
Next administration anticipates modest oil production increase. Based on president-elect Andrés Manuel López Obrador’s Nation Project 2018-2024, PEMEX’s crude oil production is anticipated to increase year on year by 33,000 b/d.
India, reference for President-elect’s refinery plan. Jamnagar, an Indian oil refinery built between 2005 and 2008, which processes close to 1.24 million b/d of crude oil and cost US$6 billion to develop, is incoming Energy Minister Rocío Nahle’s business case to revamp Mexico’s refining capacity.
Modifying Licensing Rounds could hamper investments, warns S&P Global Platts. During S&P Global Platt’s Mexico City Forum, Javier Díaz, Energy Analyst and Consultant, highlighted Mexico faces a highly competitive licensing round scenario in E&P activity, given Brazil, Colombia, Ecuador and Uruguay are also aiming at attracting investment to finance such activities.
Regulator highlights favorable economic conditions for the government in Mexico’s Licensing Rounds. CNH reported profit percentage in favor of the state in Mexico’s shared production contracts amounts to 75 percent and 63 percent for Licensing contracts. These rates are above Licensing contract terms in Brazil and the US, where the state obtains 59 and 55 percent of the profits, respectively.
CNH greenlits new well drilling operations to Diarqco and Perseus. To carry out the modifications of the evaluation plans of both companies, Diarqco and Perseus will invest an additional US$25 million in the onshore blocks of Tajon and Mayacaste.
CNH urges PEMEX fiscal regime change. Juan Carlos Zepeda, President Commissioner of CNH, stressed it is necessary for Mexico’s NOC to change its fiscal regime, enabling it to function as a true corporation and be indexed in Mexico’s stock market to access attractive sources of capital.
Iran’s oil production levels unchanged despite santions. Bijan Zanghane, Iran’s Petroleum Minister, asserted his country has not reduced its oil production and exports, despite the economic sanctions imposed by the US on the commercialization of crude oil of the Persian nation.
Traditional Oil and Gas jobs threatened by new technologies. While the industry is accustomed to adapt to the whims of commodity prices, it now faces a greater challenge: automation and digitalization.
Petrobras close to reach sale agreement for its African JV for US$1.3 billion. The African subsidiary of the Brazilian NOC holds a 40 percent stake in a joint venture with BTG Pactual SA and Helios Investment Partners in two deepwater oil exploration blocks in Nigeria, Akpo and Agbami, which are up for grabs.
Barclay’s adjusts Oil Price Outlook with higher levels for 2018-19 horizon. Based on lower supply expectations from Libya and Iran, the British Bank anticipates price hikes for Brent and WTI oil price levels.
Eagle Ford continues sparking interest. The assets to be acquired by KKR and Venado Oil and Gas include 22 producing wells and 23,000 net acres of future resource development potential.
IEA forecasts US oil production will reach 11.8 million b/d by 2019. Technological advances, improved efficiency and fragile recovery in oil prices is kindling shale oil companies to increase their drilling operations. By 2023, U.S. crude oil production could ramp up to 12.1 million b/d.
Echo Energy announces wet gas discovery in Argentina. After successfully completing the drilling of the CSO-2001(d) well, the UK oil and gas company estimates the well contains 19bcf contingent resources and 18.7bcf of prospective resources.
Want to read more on Mexico’s Oil and Gas Industry? Cick here!