ON 12 MAY, MEXICO'S HYDROCARBONS COMMISSION (CNH) PUBLISHED THE TERMS AND CONDITIONS FOR THE THIRD PHASE OF ROUND 1, IN THIS CASE TO AWARD LICENCES1 TO EXTRACT OIL AND GAS FROM ONSHORE FIELDS.

The third tender in Round 12 will auction 26 blocks in onshore fields in the states of Chiapas, Nuevo León, Tabasco, Tamaulipas and Veracruz. Those blocks have an initial volume of 2.5 billion barrels of oil equivalent (boe), of which at least 2 billion barrels are in crude resources, distributed in oil and gas fields that range in size from 16 to 135 square kilometres.

The 26 blocks have been certified as having 3P (proven, probable and possible) reserves; some are mature fields in which PEMEX has invested in infrastructure and from which it is even producing. Nine of the new fields are gas fields, while the remainder are oil fields.

A separate contract will be signed per contractual block (the 26 blocks are divided into type-1 and type-2 blocks) and the bidders should submit offers for each block in which they are interested. Contracts will have terms of 25 years, extendable for a further two years.

  1. Technical requirements
  2. Financial requirements
  3. Timeline

1. Technical requirements 

The difference compared to previous phases is that it removes the requirement to have a minimum level of prior experience in oil exploitation.

  1. Interested parties must prove that the people proposed for key management positions have at least 10 years of experience in the management and operation of onshore or offshore exploration and extraction projects.
  2. They must also provide evidence of experience in industrial safety and environmental protection for the preceding five years,experience in the implementation and operation of industrial safety, operational safety and environmental protection management systems in extraction facilities or protects.

Interested parties that have successfully achieved pre-qualification in previous tenders are understood to have met the requirements of point 2, provided that they retain the members from the previous tender.

2. Financial requirements 

1. Interested parties must provide evidence that they have book capital of:

  • $5 million per type-1 area for which they will be submitting a bid; or
  • $200 million per type-2 area for which they will be submitting a bid.

Additional criteria for consortiums or associations

2. If an operator has not met the financial requirements in previous tenders, it must provide evidence that it has:

  • capital of $3 million per type-1 area for which it will be submitting a bid;
  • capital of 120 million per type-2 area for which it will be submitting a bid, subject to two other members of the consortium providing evidence of capital of at least $80 million per type-2 area for which they will be submitting a bid.

If a consortium of association is used to make a bid, the operator must have a stake of least one third in the consortium or association.

3. Timeline

Tender and terms and conditions

  • 12 May: Publication of the call to tender and the tender rules
  • 28 August : Publication of updated tender rules (including the contract)
  • 2 November: Publication of final tender rules

Data room

  • 12 May - 14 August: Period to apply for access to the data room and to pay the required fee
  • 1 June - 14 December: Access to the data room

Clarifications to the terms and conditions and the contract

  • 12 May - 11 August: First stage of clarifications (access to the data room)
  • 12 May - 27 August: Second stage of clarifications (pre-qualification)
  • 12 May - 30 October: Third stage of clarifications (submission and opening of bids, award, decision and contract)

For further information of the other phases of Round 1, please see our previous publications:

  • Phase 1 (click here): Auction of 14 shallow-water blocks. The list of pre-qualified bidders was published in April and the definitive terms and conditions will be published on 15 June.
  • Phase 2 (click here): Auction of 9 shallow-water blocks. Access to the data room is open until 29 September and the final tender rules will be published on 14 August.