Will the Next Deepwater Horizon Be in Mexico?

12/7/16 The New York Times

1280px-development-driller-2In Dec. 5, Mexico’s Energy Ministry began auctioning off the crown jewels of its oil reserves, deepwater tracts that, along with those for fracking, are supposed to set off an oil-and-gas rush south of the border. The auctions are a result of a 2013 law that opened the country’s oil and gas industry to private companies, after 75 years of public ownership. What could go wrong?

Plenty, as recent experiences in the United States suggest. Five years ago, Deepwater Horizon familiarized the world with the risks of deepwater drilling, and Americans are increasingly aware of the dangers of hydraulic fracking. In Mexico, the threats from both will be magnified: The state-owned oil company, Petroleros Mexicanos, or Pemex, has long operated with scant environmental oversight, a legacy that will most likely carry over as private-sector operations take over.

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Successful Auction Encourages Mexico to Step Up Oil Opening

12/6/16 The Wall Street Journal

download-3MEXICO CITY—Buoyed by the results of Mexico’s first deep-water oil auction, widely seen as a big success, President Enrique Peña Nieto’s government plans to raise the bet. Mexico intends to hold a second, much bigger deep-water auction around October next year, while state firm Petróleos Mexicanos will likely seek as many as 25 partnerships with private firms over the next two years, Energy Minister Pedro Joaquín Coldwell said in an interview.

“We’re going to be more ambitious, we’ll take a step forward because we now have more experience,” said Mr. Coldwell. “What we’ll very likely see are auctions with many more oil blocks than what we have seen so far.”

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Mexico Oil Auction Succeeds in Drawing World’s Biggest Drillers

12/5/16 Bloomberg Markets

download (3).jpgMexico’s first competitive deep-water oil auction surpassed expectations as eight of 10 blocks were awarded to some of the world’s top oil companies. The National Hydrocarbons Commission awarded all four blocks in the oil-rich Perdido Basin, where the geology is said to mirror the U.S. side of the Gulf of Mexico, to companies including Total SA, CNOOC Ltd, Chevron Corp. and Exxon Mobil Corp. In the Salina Basin in the south, which is less explored and therefore considered riskier, four of six blocks were awarded. Separately, BHP Billiton Ltd. won the right to develop the Trion field in the Gulf along with Pemex.

The deep-water auction signals the beginning of a new era for Mexico, which ended state-controlled Petroleos Mexicanos’s 75-year monopoly in the energy sector in 2013 by opening the doors to foreign competitors.

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Mexico deep water oil push taps data that solved dinosaur riddle

5/11/12 Reuters

oil wellA long-awaited auction of Mexico’s untapped deep water oil fields on Monday has been fueled by a nearly $3 billion boom in geological data mapping almost inaccessible deposits to open up what the industry sees as the world’s “last great proven frontier.”

The data rush of the past two years by many top geophysical companies has sparked some of the biggest imaging projects ever for technology also used to hunt for the ruins of ancient civilizations and explain the fate of the dinosaurs.

“What they’re doing is literally rewriting the geological model of the Gulf of Mexico,” Juan Carlos Zepeda, head of the national hydrocarbons commission (CNH), Mexico’s oil regulator, said ahead of Monday’s deep water auctions where the likes of Chevron (CVX.N) and BP (BP.L) are expected to participate.

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Mexico’s Deep-Water Oil Round: The Time Of Truth For Energy Reform?

1/12/16 Forbes

oil wellMEXICO CITY — For Mexico, 2016 is drawing to a close as a difficult year. The security situation has shown no signs of improvement, with fighting among organized criminal groups and the spike in the homicide rate that occurred in 2015 (after a hopeful decline from 2011 to 2014) continuing into the first nine months of the year. In turn, low oil prices and increasing public debt levels prompted budget cuts that have impacted government spending, notably in state-owned oil company Pemex.

In this context, a sign of hope at the end of 2016 concerns developments around energy reform, the vast legal change passed in 2013 that opened up hydrocarbon exploration and production to private sector investment.  Specifically, on December 5th all eyes will be fixed on the results of the fourth round of the first bidding process (Round 1.4) to undertake exploration and production in 10 deep water oil fields in the Gulf of Mexico.

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Can Oil Help Mexico Withstand Trump’s Attack on Trade? It’s Hard to See How

The New York Times 11/27/16

energy - oil pumpsCIUDAD DEL CARMEN, Mexico — The town that oil built is emptying out. “For Sale” signs are plastered on concrete-block houses and sun-bleached bungalows alike. The idled oil workers who used to cluster in the main square, hoping to pick up odd jobs, have moved on. Here in Ciudad del Carmen, on the gulf coast of Mexico, even the ironclad union positions are slipping away. Some roughnecks on the offshore rigs of the national oil company, Pemex, have not worked in months, and their voices are filled with anxiety. “What do you think is going to happen?” some ask.

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A Victim of Trump (and Fundamentals), the Peso Falls

11/14/2016 Forbes.com, Mexico Institute Blog

By Viridiana Rios, Global Fellow, Mexico Institute

pesoI write today as a middle class Mexican whose savings lost 10 percent of their value when American voters elected a leader who pledged to renegotiate NAFTA and tax us to pay for a wall. As a result of the election and other factors, the Mexican peso has overtaken the Argentine peso and the South African Rand to become the emerging markets 2016 worst performer.

The Mexican Peso was a barometer for the presidential campaign. It lost 10 percent of its value when Clinton lost, 1.9 percent in the week after the FBI reignited Clinton’s email controversy, and hit its historical low in the days following the election as speculation turned to the potential impact of Trump’s first months in office. The peso spiked 1.3 percent in less than an hour during the first presidential debate, and when Trump’s lewd conversation about women broke, it gained 2.2 percent.

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