Mexico Gets Its First Private Oil Well in 80 Years

5/23/2017 Bloomberg

oil wellFor the first time in almost 80 years, a private company has sunk a new offshore oil well in Mexican waters — the latest step in the country’s drive to allow foreign competitors back into its energy markets.

A joint venture of London-based Premier Oil Plc, Houston’s Talos Energy LLC and Mexico’s Sierra Oil & Gas began drilling the well May 21, Premier said in a statement Monday. It’s the first offshore exploration well to be launched by anyone other than state-run monopoly Petroleos Mexicanos since the country nationalized its oil industry in 1938.

The Zama-1 well, in the Sureste Basin off the state of Tabasco, holds an estimated 100 million to 500 million barrels of crude, Premier said in the statement. Drilling is expected to take up to 90 days to complete, at a cost to Premier of $16 million. The three companies won rights to the prospect in 2015, in the first round of bidding after Mexico voted to open its ailing oil industry to private investment.

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