For the past 80 years, the Mexican government had put in strict measures to discourage foreign investors from venturing into the country’s energy markets. Foreign investors now have something to be proud of because the Mexican government has lifted off the ban. This initiative will allow foreigners to participate in their first offshore exploration since Mexico’s oil industry was nationalized in 1938.
Sierra Oil & Gas, Premier Oil PLC, and Houston’s Talos Energy PLC began the exploration of Mexican oil fields in May. Other privately-owned foreign companies are also expected to debut their operations in the fields soon. The three companies had successfully challenged the Mexican government to lift the ban back in 2015.
The Zama-1 Well is one of the largest oil and gas reserves in Mexico. It is situated on the Sureste Basin found in Tobasco State. The well has a capacity of holding 100 million to 500 million crude oil barrels. Premier Oil is certain that drilling will take place for about 90 days and this will cost over $16 million.
According to an analyst, working for Edison Investment Research, practitioners in the Mexican energy sector will keenly pay attention to the first oil and gas exploration conducted by foreigners. Elaine Reynolds expressed this insight in a note targeting Edison’s clients. Elaine also added that the project seems to have a “high geological success chance” judging from the structure of Zama-1 Well’s basin.
In reference to a statement released by Premier, Talos Energy, the operator, owns 35 percent share in the drilling venture. Consequently, Premier Oil controls 25 percent share while Sierra Oil & Gas controls 40 percent.
About Talos Energy
As an independently-owned company, Talos Energy’s operations are centered on offshore exploration and production. The company invests most of its resources on exploration, exploitation, and asset optimization. It also focuses on exploiting wells based in Gulf of Mexico and the Gulf Coast.
Talos Energy has been operating for the last 70 years. Based on the firm’s experience in the industry, it has managed to upgrade its geophysical technology, well control, and exploitation techniques. Talos Energy’s staff usually maintain an entrepreneurial style and independent spirit that focuses on achieving success.