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Mexico Awards 8 Deepwater Oil Blocks to International Companies

12 December, 2016

Mexico is so much more than just one of the best countries for expats worldwide and has recently emerged as a major player in the global oil market after awarding exploration rights to an array of international companies for eight deepwater blocks in the Gulf of Mexico in early December. Winning bids were submitted by BP,Exxon Mobil,Total,Chevron,Australia’s BHB Billiton,China National Offshore Oil Corporation,Statoil,INPEX and Petronas,as well as smaller independents like Murphy,Ophir and Sierra.

“Mexico’s reserves are close to the U.S. side of the Gulf,where international oil companies are already developing highly-productive deep-water assets,” Bloomberg wrote. “Mexico has learned to be competitive.”

Exxon Mobil,Chevron and other international oil giants have already shown great interest in Mexico’s untapped stores of offshore crude during the three years since Mexico opened its state-run oil industry to outside investment. A total of 10 deepwater exploration blocks were up for grabs in the recent auction,including four in the Perdido Fold Belt area immediately south of the U.S. maritime line,as well as six more in the Salina Basin in Mexico’s southern Gulf territory.

“In Mexico,the oil industry’s Moby Dick is the largely unexplored southern half of the Gulf of Mexico,especially in the deep waters where the state-run Petroleos Mexicanos (Pemex) has only drilled 45 exploration wells,” wrote FuelFix. “Next year,[Mexico] plans to hold two more auctions for shallow-water blocks and for onshore gas fields,which together could garner $12.9 billion in investments.” 

The recently awarded deepwater contracts will bring investments of at least $34.4 billion over the next three decades; a reality that is expected to have a wider effect on Mexico’s growing oil sector. Mexico is poised to receive between 60-66 percent of the total profits generated from the awarded contracts,and the recent auction is projected to eventually add up to 900,000 barrels per day to Mexico’s oil production.

“Many of the winning bids surpassed the auction’s minimum requirements,indicating the premiums that firms were willing to pay to develop resources in Mexico,” wrote the American Society of the Council of the Americas.

Over the coming years,Mexico reportedly plans to substantially increase its crude oil production and surpass both Venezuela and Brazil. According to the EIA,Mexico is currently the fourth-largest oil producer in the Americas,behind the U.S.,Canada and Brazil.

So,when are you planning to visit Mexico?

Whether you opt to visit west coast gems like Cabo San Lucas and Puerto Vallarta,or instead decide to experience what it’s like living in Playa del Carmen,Tulum or Cancun on Mexico’s Caribbean coast,there is truly something to suit every traveler in this amazing country! Contact us today and see for yourself why real estate throughout Mexico offers an amazing alternative to the stock market and other traditional investment options.

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