The Mexican oil industry has been completely closed off for quite awhile but things are looking set to change here in the near future. Talos Energy LLC, a Texan energy company, is looking to become the first private investor to sink an oil well in Mexican waters since 1938! Talos Energy has been on the up and up over the past couple of years and now they are looking to completely change the landscape of the industry, at least for the foreseeable future.
Mexico has spent the better part of the past 100 years isolating and nationalizing their energy and keeping it away from private investors from foreign markets. It was recently announced that there was a well found in the Sureste Basin, located right off of the coast of Tabasco, that eventual yielded a well named the Zama-1. The Zama-1 Well is predicted to have anywhere from 100 to 500 million barrels of crude oil available. Approaching the well drilling will be Talos Energy from Houston, Premier Oil from London, and Sierra Oil & Gas from Mexico’s own industry. this will be the first offshore project to be launched by anybody outside of Petroleos Mexicanos in a long time.
When drilling begins on the Zama-1 it will take roughly 90 days to complete the project. Premier Oil will be hosting the drilling and it will run them nearly $16 million to perform the operations. Talos will be actually operating the well and in return they get 35% of the stake in the well. Premier will be getting a 25% stake in the well and finally Sierra will hold 40% of the profits. The trio of energy companies won the right to take on the well back in 2015 during a private round bidding after Mexico decided to open up the doors to foreign drillers.
Edison Investment Research released a statement via analyst Elaine Reynolds saying, “As the first non-Pemex well to be drilled since the opening up of Mexican waters as part of the country’s energy reform process, this will be keenly watched by the industry.” These words were echoed by many other industry analysts.
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