Mexico Adds Offshore Bid Offerings

Mexico's upstream regulator, the CNH, has approved the auction of nine additional shallow-water fields as part of the Latin American country's ongoing "Round 1" bid round (EIF Feb.18'15). The fields sit adjacent to 14 shallow-water exploration blocks offered in the first phase of the auction in December, and contain a combined 355 million boe of proved and probable reserves. For purposes of the auction, the CNH has grouped the fields into five separate contract areas, with all but one of the areas including proven reserves. Most of the new fields hold light crude, although one is believed to hold heavy crude.The final deadline for bids is Sep. 30. The prequalification requirements will be broadly similar to those set for blocks offered in the first phase, with one notable difference -- those wishing to bid now must have produced at least 11,000 b/d of oil within the past five years. Mexico's attempts to keep some momentum behind the historic reform and opening of its upstream sector come as state-owned Pemex continues to struggle to raise output and operate at a profit (EIF Nov.12'14). Pemex reported a net loss of 264 billion pesos ($17.6 billion) for 2014, adding to a 170 billion peso loss incurred the year before. The firm's crude oil output fell 3.7% in 2014, to 2.43 million b/d, which combined with lower oil prices and a high tax burden to extend Pemex's losses.