Pemex plans more strategic alliances

Thursday, February 1, 2018

Pemex will continue with its alliances and farmout strategy with the aim of increasing production, and will soon launch a strategic partnership program that will include fields for both exploration and production, company CEO Carlos Treviño Medina said.

The state oil company's goals for 2018 are to meet its production goals and maintain financial discipline, said the executive, speaking at an energy conference in Mexico City.

Start your 15 day free trial now!


Already a subscriber? Please, login

Pemex has already struck up partnerships to develop deepwater fields, with BHP Billiton to develop the Trión block, last March, and with Chevron and Inpex in February of last year to develop deepwater block 3 in the Perdido belt, after the consortium was awarded the contract in the auction held last December.

Treviño Medina (pictured), who took over the position of CEO in November, replacing José Antonio González Anaya, highlighted the importance of making the state oil company profitable, more competitive and able to take better advantage of the energy reform.

"We have our financial needs covered to 2018 and we don't need to get into debt to cover our financial needs for this year," Treviño Medina said.

The company saw a recovery in its finances during González Anaya's tenure, who took over as CEO in February 2016, and who said in May the company had "turned a corner," as its financial situation has strengthened and oil production has stabilized and will begin to increase. The company published a five-year business plan in November 2016.

Pemex achieved a financial surplus in 2017 for the first time in many years.

The company's oil, gas and petrochemical production all declined during 2017, however, with crude oil output at an average 1.955Mb/d during the year, down from the 2.15Mb/d average seen in 2016 and the 2.26Mb/d reported for the previous year.

The company purchased oil put options to hedge against falling oil prices at US$48.50/b, guaranteeing the company's revenues, Treviño Medina said.

Also read: Oil put options seen as vital tool for Mexico

Pemex won four contracts, two individually and two in consortiums, in Mexico's January 31 deepwater auction.