The reforms in the Mexican oil industry has led to the first private well in the country in almost 80 years. The new offshore oil well is being dug through a joint venture among Mexico’s Sierra Oil & Gas, Houston’s Talos Energy LLC and London-based Premier Oil Plc. It’s Mexico’s latest step in their mission to let foreign companies participate in its energy markets. Since 1938 when Mexico’s oil industry was nationalized, only state-run Petroleos Mexicanos was allowed to do offshore oil exploration in Mexican waters. Drilling on the new well began on May 21.
The Zama-1 well, which is located in the Sureste Basin just offshore from Mexican state of Tabasco, is estimated to hold crude oil deposits of between 100 million and 500 million barrels. The well should be completed in about 90 days and cost $16 million. The three companies won the rights to prospect during the first round of bidding in 2015, after the Mexican government decided to allow private investment in its oil industry in an effort to revitalize it. The basin’s structure suggests there’s a high geological chance the project will be successful. Talos will operate the well and has a 35% stake in the project. Sierra owns 40% and Premier’s share is 25%.
Founded in 2012, Houston, Texas based independent oil and gas company Talos Energy focuses on offshore exploration as well as production. The company is led by experts with decades of experience developing and operating shelf and deepwater assets throughout the Gulf of Mexico. Talos Energy is known for their cutting-edge seismic technologies and innovative techniques with which they explore, develop and optimize their assets. The management team has a solid track record for successful offshore exploration and production.
Their experience acquiring assets in the Gulf of Mexico and Gulf Coast regions and their commitment to running safe, environmentally compliant operations makes them an industry leader in offshore oil and gas asset exploration and optimization. The Talos Energy management team previously built and sold two very successful oil and gas companies that developed and produced assets in the Gulf of Mexico.