During Mexico's "Round 0" selection process,
state-owned Pemex enjoyed the preferential right to designate those
onshore and offshore oil fields that Pemex wished to develop. Among
the blocks selected by Pemex is the ultra-deepwater Trion block,
located 30 kilometers south of the maritime border between Mexico
and the United States in the Gulf of Mexico and 200 kilometers east
of Matamoros. Having a total area of 1,250 square kilometers and
with a water depth of approximately 2,500 meters, the Trion block
borders several of the deepwater blocks that will be auctioned in
December 2016 as part of Mexico's Round 1 sale process.
Pemex estimates that the Trion has probable reserves of
approximately 485 million barrels of oil equivalent, which is
roughly equal to the total probable reserves of all other Round 1
blocks combined, and it will require upward of US$11 billion to
develop.
On July 27, 2016, Pemex and the Mexican National Hydrocarbons
Commission (Comisión Nacional de
Hidrocarburos or "CNH") published in the Mexican
Official Gazette the terms of a bid process to award to one or more
private investors the right to partner with Pemex to develop the
Trion block. A private investor will be the operator, and the
operator must hold a working interest of between 35 percent and 45
percent of the Trion block. Pemex will be required to hold least a
45 percent working interest. The Trion block will be developed
pursuant to Mexico's license contract regime.
The auction of the right to partner with Pemex in the development
of the Trion block is expected to take place on December 5, 2016.
Private investors wishing to participate in the auction must
pre-qualify by demonstrating certain financial and technical
capabilities by September 5, 2016, and the final version of the
license contract and final bid terms are expected to be published
on September 30, 2016.
Joint bids from multiple private investors will be permitted,
provided that non-operating working interest owners may not hold
more than 10 percent. The bidders must bid with a minimum carry
interest of US$464 million, and the joint operating agreement will
be granted to the bidder that offers the largest amount of
additional minimum investment commitment.
The operators and non-operators must comply with the same minimum
financial and technical requirements respectively provided for the
deepwater Round 1 bidding process (CNH-R01-L04/2015).
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