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LatinNews Regional Monitor: Mexico - 28 March 2018
In brief: Mexico
* Mexico’s energy ministry (Sener) has announced that the country has successfully auctioned off 16 of 35 concessions on offer in the first phase of its third round of oil concessions. The number of contracts awarded exceeded government expectations for 6-7 awards. Sener estimates that the awarding of the new contracts will result in some US$8.6bn in investment in the sector. A total of 21 oil firms participated in the auction, including foreign companies from countries like Germany, Spain, the US, and the United Kingdom. Mexico’s state-owned oil company Pemex won seven of the 16 contracts awarded, the majority of them in conjunction with other companies, after paying out US$124m to secure them. The Mexican government is expected to receive on average 72% of the profits produced by the exploitation of the concessions through contractual fees and income taxes, though it may rise as high as 78% if the concessions prove to be profitable. Mexico’s national hydrocarbons commission (CNH), the energy sector regulator, has said that it will formalise the contracts after 2 April, with the contracts coming into effect 90 days after CNH approval.
