Northcote Energy ramps up Mexico expansion plans

Independent oil and gas company Northcote Energy said Tuesday it is in talks with other private investors to develop new projects in Mexico.

The announcement came as Northcote raised 2.8mn British pounds (US$4.2mn) via a discounted share placing to expand in Mexico's newly opened energy sector, the London-based firm said in a statement.

"The financial firepower we now have gives us the flexibility to take down new business opportunities in Mexico," Northcote managing director Randall Connally said.

The company's plans in the Latin American nation include the construction of a waste remedial plant in an unnamed onshore hydrocarbon basin.

Meanwhile negotiations are underway with US service companies for midstream and downstream opportunities in the country, the statement said.

Northcote, whose focus until now has been on US onshore basins, said it is also seeking new projects through its joint venture with Mexico-based Gaia Ecológica.

"These steps will solidify our position as a strong partner for Mexican and international companies in opportunities emerging through the energy reform in Mexico," Connally said.

"We believe [they will] lead to opportunities across the sector, including participation in lucrative oil & gas concessions as well as other major projects in the future."

Mexican President Enrique Peña Nieto last year signed off on a landmark energy bill that ended the decades-long monopoly of state firm Pemex on oil production.

The first opportunity for companies to participate is the so-called Round One tender, offering 169 offshore and onshore blocks. Launched late last year, the first awards are expected to be announced in July.

The government says the first two packages for shallow water contracts will attract investment of US$21.3bn.