Pemex Awards MSC for Mision Block to Mexican-Argentine Group

Pemex awarded the third Multiple Services Contract to a Mexican-Argentine consortium. The US$ 1,035,579,600 contract is for the execution of works related to the development, infrastructure, and maintenance of non-associated gas reserves in the Mision block in the Burgos Basin.

The bidding consortium includes Mexican company Industrial Perforadora de Campeche and Argentine company Tecpetrol.

The presence of a Mexican company in yet another tender reaffirmed that domestic firms have a competitive place in the MSC process, and will play an important role in the development of natural gas in the Burgos Basin.

In accordance with the procedures established in the Public Works Law, which provides a fully transparent process, PEP opened the economic bid on Thursday morning in the presence of a notary public, a public witness, and representatives of the Federal Controller's Office.

After Pemex reviewed the details of the economic proposal - which includes the fees of the works and services to be provided under the contract - and determined that the proposal meets the economic requirements and is beneficial to Pemex, it announced the formal contract award in a ceremony Thursday evening.

The Mision block spans 1,972 square kilometers and comprises 21 separate gas fields in the States of Nuevo Leon and Tamaulipas. The winning contractor is expected to increase natural gas production in the Mision block by an estimated 91 million cubic feet per day in the first several years.

By leveraging the efficiencies of the contractors, the Mision contract provides an estimated cost savings of US$ 180 million for Pemex.

Mision is the third block awarded in the Multiple Service Contract program, following the award of the Reynosa-Monterrey block to the Spanish company Repsol-YPF on October 16, and the award of the Cuervito Block to a Brazilian-Mexican-Japanese consortium on October 23.

Taken together, the first three MSC contracts provide Pemex with substantial savings - approximately US$ 700 million over the life of the contract - and additional production of 350 million cubic feet per day.

The MSCs bundle various services, including seismic surveys, drilling and development, pipeline construction, and maintenance; previously these services had been contracted individually. Under this program, Pemex expects to increase its capacity to carry out the Burgos Basin Project, which will increase non-associated natural gas production in northern of Mexico, reduce imports, and help meet the increasing demand for natural gas in the country.

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