BHP Billiton wins big in Mexico oil auction

BHP Billiton wins big in Mexico oil auction

A number of the world’s largest oil companies have won bids to develop Mexico’s offshore oil deposits in a tender which could generate US$40 billion in investment.

Oil giants such as Exxon Mobil, Chevron and China National Offshore Oil Corp all battled it out as eight of the 10 blocks available were purchased.

BHP Billiton, the world’s largest diversified mining company, became the first foreign company to enter a joint venture with Mexico’s state-run Petróleos Mexicanos (Pemex).

The Anglo-Australian firm beat BP to the deepwater Trion oilfield with a bid of $624 million for a 60% controlling stake in the joint venture. BP bid $604 million.

Steve Pastor, president of BHP’s petroleum unit, said: “This opportunity aligns with our strategy of owning and operating tier-1 assets and provides an opportunity for BHP Billiton to leverage its industry leading deepwater drilling, development and operational expertise to create value in Mexico.”

The Trion joint venture and the other development blocks formed the foundations of President Enrique Peña Nieto’s 2013 energy reform laws which encouraged foreign investment for the first time since nationalisation in 1938.

“We’re very happy that this investment will come to Mexico,” said Juan Carlos Zepeda, head of the country’s energy regulator, the National Hydrocarbons Commission. “The energy reform initiated by President Pena is a success.”

@RGNonline

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