This is the third phase of bid round one and part of Mexico's energy reform, which is intended to boost domestic oil and gas production by enabling foreign companies to invest in Mexico's Energy industry, ending a 76 year old state monopoly.
As part of Phase 3, a total of 26 Land Contract Areas in the states of Chiapas, Nuevo Leon, Tabasco, Tamaulipas and Veracruz will be awarded to companies that satisfy the pre-qualification requirements and win the subsequent tender process.
The key criteria for the award of land contract areas include:
Experience and technical capacity criteria:
The participants should also present the documents specified in the pre-qualification for AML purposes and the comparative information set forth in the pre-qualification guidelines.
MX Oil's joint venture company with local operator partner Geo Estratos is anticipated to make an application to pre-qualify. MX Oil is primarily focussed on Type 1 blocks, which include onshore fields with estimated resources of around 100 million barrels of oil equivalent (mmboe).
MX Oil's Chief Executive Officer Stefan Olivier said,
"I am highly encouraged to see the pre-qualification criteria that CNH has released, as this means that we do not need to bring in a production partner nor do we have to dilute our equity in order to meet any capital criteria at this stage. This is exciting news for our shareholders as it allows us to submit our pre-qualification application and bid for assets which, if successful, would give us considerable ownership with a limited financial outlay."
"I believe that we are in a very strong position in the country, both as an early mover into this space and as one of the most established, in terms of on the ground expertise and experience operating the type of fields being offered in Phase 3. We are in a highly advantageous position due to our JVCo's credentials in satisfying the announced pre-qualification criteria and our extensive proprietary database on the conventional onshore blocks that we are focused on. I firmly believe that in the near term, our JVCo will be able to announce that we have pre-qualified at which point I believe that we will be considered a strong bidder in the forthcoming bid round. Furthermore, I would like to reiterate to our shareholders, that we do not anticipate raising any equity until after we have secured a company making asset or assets and I look forward to updating our shareholders in due course."