Hill Holler

Raw Political Coverage and Opinions

Home /
The resurrection of Mexico’s Oil Industry

The resurrection of Mexico’s Oil Industry

On an article published by Bloomberg, a private company has for the first time in nearly 80 years sunk an offshore oil well at the Mexican waters. This was the last step for Mexico in allowing competitors from foreign region in re-entering its energy markets. The well started being drilled on May 21st through a joint venture of Talos Energy LLC from Houston, Premier Oil Plc which is based in London and Sierra Oil & Gas from Mexico. This is the 1st offshore exploration that has been launched by anyone apart from Petroleous Mexicanos which is state-run.
Bloomberg stated that Mexico nationalized its industry of oil back in 1938. The Zama-1-well is situated in Sureste Basin which is off the Tabasco state. The well holds approximately 100 million-500millioncrude barrels. The drilling will take almost 90 days for it to be completed and will cost $16 million to Premier. The 3 companies forming the joint venture won the prospect rights in 2015, during the 1st round of bidding. This was after Mexico made a vote to allow private investment to its ailing industry of oil. According to Elaine Reynolds who is an analyst with Edison Investment Research, Ltd, this is the 1st non-Pemex well that has been drilled since the Mexican waters were opened as part of the energy reform process of the country.
The project is said to have a high geological probability of success due to the structure of the basin. Charlie Sharp who is an analyst with Canaccord Genuity Ltd, states that the Zama well is among the most interesting exploration wells that has been drilled in the oil industry this year.
An independent oil and gas firm, Talos Energy is focused on the offshore exploration as well as production. The expertise of the company is based on getting assets around the Gulf of Mexico and Gulf Coast regions. Talos Energy posses more than 33,000 square miles worth of 3D seismic data. The company has employed an experienced and skilled team of professionals who are committed to achieve the strategic goals of the company. Talos Energy has acquired a reputation as a reliable and efficient oil and gas company.