Ten of the 15 blocks on offer in Mexico’s Round 2 licensing round of Gulf of Mexico shallow water acreage were awarded June 19.
Strong competitive bid interest was registered, with two or more bids received on areas 6, 7, and 9-11, with offers there consequently high. However consultancy Wood Mackenzie said that offshore gas potential in areas 4 and 5 “would limit returns given low gas prices” and neither received bids.
Italy’s Eni was involved in three winning bids, while UK independent Cairn Energy’s Capricorn subsidiary, Mexican state Pemex and Colombian state Ecopetrol were each involved in two areas.
Other IOCs involved were Malaysian state Petronas, Russian Lukoil, with Total and Shell teaming up for a winning bid on area 15 – the most easterly of the areas offered. Mexico-based Sierra and Citla teamed up with IOCs on their bids, as did Russia-backed producer DEA (with Pemex on area 2).
In contrast there were no bids for areas 1, 3, 4, 5 and 13. Wood Mackenzie had anticipated most activity to centre around areas 6-11 with some bids for areas 12-14 and also accurately predicted that two-thirds of the 15 blocks offered would be awarded.
Firms that just missed out on awards were a consortium of US Murphy Oil, the UK’s Ophir and Mexican Talos Energy for area 6 and China Offshore Oil Corporation for area 11, while other unsuccessful bidders included Chevron and Noble Energy.
This week’s Round 2 awards follow Mexico’s successful Round 1 licensing round of deepwater Gulf of Mexico areas in December 2016.
|Mexico Round 2 shallow waters (winning consortia)|
|area||winning consortium||Mexican state equity||additional||weighted value|
|stake (%)||investment ratio||of economic offer|
|1, 3, 4, 5 & 13||no bids|
|2||DEA and Pemex||57.92||1||63.493|
|6||Petronas and Ecopetrol||65.19||1||71.178|
|7||Eni, Cairn Energy and Citla||75||1.5||84.825|
|8||Pemex and Ecopetrol||20.1||0||20.1|
|9||Cairn Energy and Citla||75||1.5||84.825|
|11||Repsol and Sierra||62.28||0||62.28|
|14||Eni and Citla||37.27||0||37.27|
|15||Total and Shell||30.11||0||30.11|