Underfunded and overlooked, Petroleos Mexicanos, or Pemex, found itself unable to fund deep sea extraction in the Gulf of Mexico by itself. It is now looking for partners to develop crude on the Gulf, and it seems its going by the way of auction in December.
Pemex took a hard hit this year, as their budget got cut by $5.5 billion as a part of an energy reform. This has really taken a toll on their extraction rates and reserves, to the point where they will have to sell extraction rights to better equipped companies in order to maintain Mexico’s oil industry on track.
So far Pemex has held talks with Exxon Mobil, Total SA and Chevron Corp, and its these three that are expected to lead the bidding for the 10 areas in the Perdido region near the US maritime border.
The Norwegian company Statoil ASA is expected to have joined the talks too.
The Mexican government expects to raise $44 billion from what is the first deep water auction in the country’s history. Even with the high stakes reward, Mexico should be aware that it is mortgaging out its future since 76% of their prospective oil resources are located in the deep sea of the Gulf, so if they were to lose control of the revenues their future oil security could be at serious risk.