Mexico's Bid Round Hurt by Consortia Restrictions

The restriction on partnership flexibility was one of the major factors that hurt Mexico’s inaugural bidding round for oil and gas explorations rights, according to a presentation made Thursday at a conference in London.

Speaking at the Geological Society's Finding Oil & Gas in Mexico conference, Read Taylor, executive director for upstream Mexico at Sierra Oil and Gas, said the bid round suffered from "a lot of restrictions" on companies that got together in a consortium in order to obtain licenses.

"I was involved in 13 bid rounds in Brazil and we were doing deals for the bid … upstairs in the hotel room while the bid was going on downstairs. You can't do that in Mexico. You sign up months in advance and that's the guy you go to the dance with and you can't change that dance partner. That's the guy you're with, and if you don't like the same blocks, these things break up…Unfortunately what happened was it created a shortlist of companies that survived each other and were able to actually get to the bid round … Good news for us but bad news for the industry."

Sierra Oil and Gas, along with its partners Talos Energy and Premier Oil, was awarded two blocks during the first tender of Mexico's bid round one. The first phase of the auction saw just two of 14 contracts offered to companies.

In his presentation, Taylor also suggested that giving companies access to early 3D seismic data is the key to developing technical excellence and implied that the contracts associated with the bid round were too complex. The next phase of the bid round, which involves nine shallow-water oil fields, will be awarded Sept. 30.

A graduate in journalism from Cardiff University, Andreas has eight years of experience as a business journalist. Email Andreas at


Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Marķa Ortiz | Sep. 17, 2015
Thanks for sharing these thoughts. However, some of these issues were amended just some days ago by the National Hydrocarbons Commission.

Related Companies

Our Privacy Pledge

More from this Author
Andreas Exarheas
Assistant European Editor | Rigzone
 -  Oil, Gas Automation Sector Suffering F... (Oct 25)
 -  Industry Must Be Presented As Stimulat... (Oct 25)
 -  Subsea 7 Secures Services Contract Off... (Oct 20)
 -  Faroe to Increase CAPEX in 2017 (Oct 19)
 -  Norwegian Production Drops 18% Month-o... (Oct 18)

Most Popular Articles

From the Career Center
Jobs that may interest you
Contract Administrator
Expertise: Contracts Administration
Location: Chesapeake, VA
Project Manager, Oil and Gas
Expertise: Petroleum Engineering|Project Management
Location: West Chicago, IL
Business Development Manager
Expertise: Business Development|Construction Manager
Location: Portland, OR
search for more jobs

Brent Crude Oil : $51.46/BBL 0.61%
Light Crude Oil : $50.52/BBL 0.64%
Natural Gas : $2.83/MMBtu 5.35%
Updated in last 24 hours