Mexico’s government is hoping 2015 will bring a new era for the Mexican economy as the country hopes to diversify national oil contracts beyond Petroleos Mexicanos. This year, the country was largely concerned about reforms, especially in the energy sector. CCTV America’s Franc Contreras reported this story from Mexico City.
Aside from the 43 missing students, 2014 was largely about energy reforms as world oil prices have fallen dramatically.
Mexican Government to open bidding for oil contracts in 2015Mexico's government is hoping 2015 will bring a new era for the Mexican economy as the country hopes to diversify national oil contracts beyond Petroleos Mexicanos. This year, the country was largely concerned about reforms, especially in the energy sector. CCTV America's Franc Contreras reported this story from Mexico City.
Petroleos Mexicanos, also known as Pemex, has been Mexico’s state-owned oil monopoly since 1938. But in 2014, Mexican President Enrique Peña Nieto’s administration brought forward changes to the energy sector that will allow foreign energy companies to participate in several rounds of bidding for 14 crude oil reserves locations in the Gulf of Mexico.
The first round of biding opened this month for shallow water exploration in less than 500 meters (1,700 feet) off the coasts of Veracruz and Campeche. Companies that win exploration and drilling contracts will work alongside Pemex.
“Pemex is of course a company that is owned by the government and it means [you’ll] probably be treated fairly if you do joint ventures with them because they are going to protected to a certain degree by the government,” Wood said.
The Mexican government said it’s committed to full transparency on these deals, and that all contracts will be made public. The areas up for bidding will be explored through shared production contracts expected to run for 25 years. The exploration phase can continue for a maximum of five years while, while the remaining 20 must be dedicated to production.
The first round of bidding closes in July 2015, while bidding for deep water contracts will begin in a later round. Experts say it will likely take several years before the Mexican people will see the economic benefits of these reforms.
Saruhan Hatipoglu of BERI discusses Mexican and Latin American economies
CCTV America interviewed Saruhan Hatipoglu, CEO of Business Environment Risk Intelligence, a consulting firm that advises business clients on global strategies, about the Mexican and Latin American economy.