Mexico to adjust terms of tender for Round One

Mexico has announced it will postpone the deepwater phase of the Round One tender and modify the terms of upcoming phases. The news follows the disappointing results earlier in the month of the first call to bid of the five-phase Round One, which saw only two out of 14 potential blocks awarded. Mexico’s energy minister Pedro Joaquin Coldwell explained the changes on local television on Wednesday.

The government plans to ease the guarantor provisions that saw consortia bidding on oil blocks required to have one member hold at least $6 billion in shareholder equity to cover the state’s interest in the event of a major accident.

The government also plans to adjust rules that prevented a consortium from picking a replacement for a pre-selected company that has dropped out, and allow companies to launch a second bid even if their initial one failed to meet government standards.

Round One is the first bidding process in Mexico’s oil and gas industry open to private investment. It follows an energy reform passed in August 2014, intended to break up the monopoly previously held by Mexico’s national oil company, Pemex. The fifth phase for shale and unconventional resources has been delayed indefinitely until oil and gas prices improve.

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