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."
Recommended Reading
CERAWeek: Tecpetrol CEO Touts Argentina Conventional, Unconventional Potential
2024-03-28 - Tecpetrol CEO Ricardo Markous touted Argentina’s conventional and unconventional potential saying the country’s oil production would nearly double by 2030 while LNG exports would likely evolve over three phases.
Woodside Brings in the Know-how
2024-04-01 - Woodside Energy Group CEO Meg O’Neill is relying on technical sophistication to guide the Australian giant as it takes on three challenging projects in the U.S. Gulf of Mexico.
Baker Hughes Detects LNG Slowdown Solutions, Global Opportunities
2024-01-26 - Baker Hughes’ fourth quarter earnings call confronts Biden’s halt on LNG permitting with “solve itself” attitude.
ConocoPhillips CEO Ryan Lance Calls LNG Pause ‘Shortsighted’
2024-02-14 - ConocoPhillips chairman and CEO Ryan Lance called U.S. President Joe Biden’s recent decision to pause new applications for the export of American LNG “shortsighted in the short-term.”
Antero Poised to Benefit from Second Wave of LNG
2024-02-20 - Despite the U.S. Department of Energy’s recent pause on LNG export permits, Antero foresees LNG market growth for the rest of the decade—and plans to deliver.