The Mexican government has a reputation for entertaining a monopoly of its energy markets, keeping private investors for away. But 2017 marks a change in their policy now that Mexico’s waters have been opened to a select number of companies helping to open up their energy industry.
Texan oil company Talos Energy has partnered with Sierra Oil and Premier Oil of London to enter into this new territory and began drilling in May of this year. This joint venture lobbied the Mexican government back in 2015 for the rights to drill first when it became known that the Mexican government was considering opening its waters to outside investment. It’s the first time a private and foreign entity has ever drilled in this territory since 1938.
They are currently operating the Zama-1 well in the Sureste Basin off Tabasco. Estimates put production of crude oil at 100 to 500 million barrels from this location. This estimate is expected to be the result of a 90-day drilling schedule that will cost approximately $16 million.
This move into Mexican waters is being cited as a much needed win, and not just for the local energy industry. Analysts from Edison Investment Research, have said that the joint venture signals a change in Mexico’s attitude towards foreign investment. Depending on the completion of this initial run, it could encourage the country to open itself up more to further drilling. Industry leaders will likely pay close attention to how Talos, Premiere and Sierra and received, as will leaders of nations who’ve otherwise been unwelcoming to energy companies.
About Talos Energy:
Founded in 2012, Talos Energy is an oil and gas company based in Houston, Texas. By specializing in exploration and production, Talos Energy has been a key player in the development of shelf and deep-water techniques and new technologies in use throughout the Gulf of Mexico.
Being an ambitious figure in energy production has allowed Talos Energy to become a notable figure in the industry. This has led to the formation of partnerships with other influential companies as well as forming lasting ties with nations. Talos Energy’s growth can be seen in the creation and eventual sales of large companies like Phoenix Exploration Company and Gryphon Exploration Company.
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