A Mexican government plan to boost the energy sector that could be unveiled in the coming weeks will not likely include any new exploration or production projects open to private or foreign oil firms, the head of an oil sector trade group said Sept. 3.
A possible infrastructure investment plan from President Andres Manuel Lopez Obrador aimed at boosting Mexico's ailing economy has been the subject of recent discussions with key business lobbies, including Mexico's oil company association, AMEXHI.
The trade group's director, Merlin Cochran, said in an interview that despite the high-level dialogue, the government's focus is likely elsewhere.
"We don't expect that there will be anything new in exploration and extraction in this infrastructure plan," he said.
The former energy ministry official and veteran of oilfield services company Schlumberger Ltd. said it is also unlikely that the Lopez Obrador administration will authorize any new joint-venture partnerships for state-owned oil company Pemex .
"Not in the short term," he said.
In April, the head of Mexico's oil regulator, the National Hydrocarbons Commission, told Reuters he believed that new Pemex joint ventures, also known as farm outs, were "imminent." But to date, no such projects have been announced.
In July, private and foreign oil companies produced some 57,000 bbl/d, up 45% year-on-year, according to government data.
Pemex production in July stood at 1.55 million bbl/d, a record low.
The president, a longtime skeptic of private oil producers, says the companies have failed to produce crude quickly or significantly invest in projects won at past oil auctions that he has since suspended.
According to data from AMEXHI, whose 35 members include U.S. oil major Chevron Corp. and France's Total SA, the firms have spent $13.6 billion across dozens of exploration and production projects, including some $2.5 billion in royalty and tax payments.
Lopez Obrador's predecessor championed a sweeping 2013-14 energy reform that ended Pemex's longstanding monopoly and paved the way for more than 100 oil contracts to private and foreign companies.
Asked if the reform's opening to private producers is dead, Cochran paused several moments before answering.
"Look, we'd love to see new opportunities."
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