Andrés Manuel López Obrador (AMLO) has made clear that his administration will stop hydraulic fracturing (fracking) activities., the president-elect announced on July 31. This technique, commonly used in the US, has just started gaining traction in Mexico for the production of tight oil and gas (shale oil and gas). “We will not use this method to produce oil and gas,” AMLO said.

The announcement comes two weeks after CNH postponed Rounds 3.2 and 3.3 as well as PEMEX’s seven farmouts, initially scheduled for Sept. 27, 2018 and postponed to Feb. 14, 2019.

 

Round 3.3 Blocks. Source: CNH

 

Round 3.3 was to offer nine blocks in the Burgos basin that contain unconventional resources, which would therefore require production techniques such as fracking.

CNH’s presentation of Round 3.3 included regulations to ensure safety and environmental protection compliance. The official regulatory document can be found here.

When announcing the postponement of the rounds and farmouts, Juan Carlos Zepeda, President Commissioner of CNH, said the delay would in fact be beneficial as “CNH will accompany the new administration in all the relevant details it would like to add into the E&P contracts and future licensing and farmout processes.”

 

CNH Regulation. Source: CNH

 

While the future of Round 3.3 remains in the air it should be noted that AMLO has changed his position on a number of issues in the past. For example, he has agreed to  review the contracts CNH signed during the previous rounds rather than outright canceling them and relaxed his opposition to the construction of the Mexico City New International Airport (NAICM).

 

Want to read more on Mexico’s Oil and Gas industry? Click here!

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