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Mexico is due to hold its first deepwater auction on December 5, but state oil firm Pemex CEO José Antonio González Anaya (pictured) said the circumstances are not the best given current weak oil prices.
González Anaya has nevertheless voiced cautious optimism about the auction, local paper El Financiero reported.
In the auction, four contract areas are up for grabs in the Perdido belt and Salina basin in the Gulf of Mexico. The process is expected to attract investment of around US$44bn, according to energy ministry estimates.
Twenty-six firms are due to participate in the auction, 16 operators and 10 non-operators, including Atlantic Rim, BHP Billiton, BP, Chevron, China Offshore Oil Corporation, Japan Oil, Gas and Metals National Corporation, Eni México, ExxonMobil, Hess, Murphy Sur, Petro-Canada Holdings, Statoil and Total.
"I am cautiously optimistic that this will go well, but we must not forget it is a deepwater project and for that to be profitable it needs a relatively high oil price. They will begin production in five years, so these are not the best circumstances under which to enter deepwater, but the opportunity is historic," González Anaya was quoted as saying at a forum.
The director of Shell Mexico and president of the Mexican association of hydrocarbons firms, Alberto de la Fuente, was reported as saying he remains optimistic, but added that areas of opportunity such as regulation and the simplification of bureaucratic processes need to be addressed.
"That should be the focus. The models are there and they need to be worked on to consolidate them and move forward with this," he was quoted as saying.
Mexico's energy minister Pedro Joaquín Coldwell has described the deepwater auction as the "jewel in the crown."