Burlington Eyes Burgos Basin Reserves
Burlington Resources Inc. has expressed interest in developing and producing natural gas reserves in Mexico if that country sets attractive terms for participation by foreign companies. The Mexican Government and Pemex have drafted plans for foreign companies to take part in the development of natural gas reserves in the Burgos basin, across the border from Texas, through so-called multiple service contracts. "We certainly like the Burgos basin," Burlington Resources Chairman and Chief Executive Officer Bobby Shackouls said. "Whether or not we'll be a participant depends on the economics and the terms of the contract," Shackouls added.
Shackouls said the geology of the Burgos basin was similar to areas of the United States where Burlington operates, but noted that the plans to attract foreign investment have not been finalized and face domestic political opposition in Mexico.
Under the contracts, scheduled to be put up for bidding in November, foreign companies would be paid fees for services they provide to develop and produce the gas. Mexico's constitution grants Pemex exclusive rights to explore for and produce oil and natural gas. Since Mexico nationalized its oil industry in 1938 it has been widely regarded as a symbol of national sovereignty and independence.