(Adds details on contracts, dates, well and pre-qualification
By Adriana Barrera
MEXICO CITY Feb 27 Mexico has approved draft
auction terms for five shallow water areas containing around 355
million barrels of oil equivalent (boe) as part of its Round One
tender opening up oil fields to foreign investors, the country's
energy regulator said on Friday.
The areas, located in the southern Gulf of Mexico, are
divided into nine production-sharing contracts which will be
awarded to companies or consortia by late September.
The final bidding terms and contracts for the areas already
in various stages of development will be published by the end of
May, a couple of weeks earlier that had been envisioned, said
Juan Carlos Zepeda, head of Mexico's national hydrocarbons
Mexico's historic Round One tender includes dozens of
fields grouped by basin, with the first batch of 14 contracts
approved in mid-December.
The newly approved second tranche covers about 108 square
miles (280 sq km) and have similar terms and conditions as the
first batch, including tax and royalty payments and gradually
increasing national content requirements.
Winners of the draft contracts must drill at least nine
wells during the first two years of the 25-year contracts, which
can be extended by two additional 5-year periods.
To pre-qualify for the contracts, operating companies must
have a decade or more of offshore experience in at least three
exploration and production projects that total at least $1
billion in capital investment.
The companies must also be able to demonstrate production of
at least 10,000 boe since 2010.
Edgar Rangel, a CNH Commissioner, said he expected output
from the fields to average 125,000 barrels per day (bpd), with
the potential to rise to 150,000 bpd.
"It is a very good volume, it is good crude," Rangel said.
Round One covers areas including the onshore Chicontepec
basin and the deep water Perdido Fold Belt. The government has
said it expects to attract up to $50.5 billion in investments
between 2015 and 2018.
Last month, however, the government said tenders for
exploration and production of shale and other more expensive oil
and gas deposits could happen later than planned because of
slumping oil prices, which could also hit government spending in
State-run oil company Pemex has postponed some
deep water exploration projects and will cut jobs because of the
Pemex is struggling to reverse a decade-long slide in crude
production and exports after the historic overhaul of the
domestic energy sector was finalized last year, ending its long
Mexico is the world's 10th largest crude producer and oil
revenue makes up about a third of its budget.
(With reporting by David Alire Garcia, Ana Isabel Martinez,
Christine Murray and Joanna Zuckerman Bernstein; Editing by