Pemex finds two partners for onshore blocks. Zero bids for offshore asset

Mexico on Wednesday organized a bidding for oil companies interested to partner with Pemex for three blocks in Mexico. Three blocks were put on offer, one offshore and two onshore.

The shallow water offshore block, containing Ayin and Batsil fields, received no bids. The area was previously described by Pemex as very attractive, with exploration success probability greater than 50 percent, and the nearby preexisting infrastructure that would make the development easier.

According to info found on the Pemex website, the Ayin and Batsil fields contain total 3P reserves of nearly 300 million barrels of crude oil equivalent.

They cover an area of 1,096 square kilometers with a waterway of 82 meters in the Batsil field and of 176 metres in the Ayin field, a depth that surpasses that of all the fields that Pemex has developed in shallow waters.

The block includes a total of 12 wells (10 exploratory wells and two development wells), mainly of heavy crude, as well as medium crude and dry gas.

Onshore partners found

Despite Pemex failing to entice interest for its offshore asset, it on Wednesday managed to find partners for the Cárdenas-Mora and Ogarrio onshore blocks.

The Egyptian company Cheiron  submitted a winning bid for the Cárdenas-Mora block by making an offer consisting of an initial payment of 125 million dollars, which acknowledges previous investments made by Pemex, as well as additional royalties of 13% and a cash payment of 41.5 million dollars (md), which guarantees that the Mexican State will receive the value of the rent of the oil field.

The Cárdenas-Mora block covers a surface of 168 km2 and is located approximately 62 km from Villahermosa, in the state of Tabasco. It contains proven (1P) reserves of 93 million barrels (MMbpce) of light, high-quality crude oil equivalent (39°API).

Participation in this block will be divided between Pemex and Cheiron, with 50% each, including some parts of the existing infrastructure, as has been established in the Bidding Terms. Cheiron, which will be the operating company, is a global enterprise with its headquarters in Cairo.

Dea for Ogarrio

The German company DEA Deutsche Erdoel was the winning bidder of the process for the Ogarrio field. This was achieved by offering an initial payment of 190 million dollars, acknowledges previous investments made by Pemex, as well as an additional royalty of 13% and a cash payment of 213.9 md, which is the highest sign-up bonus ever offered in CNH (Acronym in Spanish for National Hydrocarbons Commission) bidding processes, and which guarantees that the Mexican State will capture the value of the rent of the oil field.

Ogarrio is a mature field that is located in the Southeastern Basins. It covers a surface of 156 km2 and lies approximately 65 km off the coast of Coatzacoalcos, in the state of Veracruz. According to Pemex estimates, it contains 3P reserves of 54 MMbpce of high quality light crude oil (37°API). There is the opportunity to increase this field’s production in the short term by interventions to existing wells.

Participation will be divided between Pemex and DEA Deutsche, with 50% each, which includes some of the existing infrastructure, as established in the Bidding Terms. The German operating company is a global enterprise, with its headquarters in Hamburg. It maintains a presence in four continents, mainly in Europe and Northern Africa.

It is estimated that the production in the fields of Ogarrio and Cárdenas-Mora will increase by at least 30% through secondary recovery processes.

Commenting on obtaining operatorship of the Ogarrio field, Thomas Rappuhn, CEO Deutsche Erdoel AG said: “We are very pleased with the acquisition of the operatorship in Ogarrio, which is a meaningful step for Deutsche Erdoel AG to expand in Mexico. Building a long-term business in Mexico, with a portfolio of attractive exploration, development and production assets is part of our strategy.”

Offshore Energy Today Staff