Private companies have finally ventured the Mexican oil drilling industry after over 80 years of state-controlled monopoly. State-owned Petroleos Mexicanos has controlled the industry since the nationalization of the Mexican oil sector in 1938. Venturing the monopolistic industry wasn’t easy as it took a collaboration of three companies namely, Talos Energy LL, Mexico’s Sierra Oil and Gas and Premier Oil Plc. The three companies became the first private companies to sink offshore oil well in the Mexican waters.
An Ailing Industry
The three companies have sunk a well, The Zama-1 located in the Sureste Basin off Tabasco State. The well is estimated to hold between 100 million to 500 million barrels of crude oil. Drilling would be complete in 90 days time. Allowing private investors in the industry was agreed in 2015 in a bid to rescue the ailing oil industry. Liberalization of the sector is expected to attract more foreign competitors into the Mexican oil exploration industry.
Statement from Analysts
According to Elaine Reynolds, an analyst at Edison Investment Research Ltd, Zama-1 drilling will be keenly watched as it is the first non-Pemex well to be drilled since the liberalization of the industry. Given the structure of the basin, the project has a high geological probability to succeed. On his side, Charlie Sharp, an analyst at Canaccord Genuity Ltd, stated that Zama-1 would be the most exciting oil exploration project of the year. Sierra has the largest stake in the venture followed by Talos Energy and Premier Oil with 40, 35, and 25 percent respectively.
About Talos Energy
Talos Energy is a private oil and gas company that specializes in buying assets in the Gulf Coast and Gulf of Mexico regions. The firm is backed by investment funds from Riverstone Holdings, Apollo Global Management, and Talos Management. Led by a team of experienced offshore exploration experts, the company is committed to explore, exploit and optimize its assets through cutting-edge seismic technologies and innovative technologies.
Talos Energy was founded in 2012 and has its headquarters in Houston, Texas. Talos Energy has achieved significant milestones. In 2013, WorkplaceDynamics named it as the best workplace among local enterprises. Talos strives to build a swiftly growing company through ensuring safe and environmentally compliant operations.
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