The Road to First Oil for Mexico’s New Offshore OperatorsWed, 07/19/2017 - 09:24
Moderator: Jeroen Posma, Director General of Mexico Business Publishing
Panelist: Timothy Duncan, President and CEO of Talos Energy
Panelist: Gregory Hebertson, Vice President Western Hemisphere Exploration & New Ventures of Murphy Oil Corporation
Panelist: Andres Brugmann, Country Manager Mexico of Fieldwood Energy
Panelist: Carlos Morales Gil, CEO of PetroBAL
Boosting participation in the licensing rounds will help fill government coffers, panelists at the Mexico Oil & Gas Summit 2017 said on Tuesday in Mexico City. The panelists were addressing The Road to First Oil for Mexico’s Offshore Operators, a discussion that came on the heels of the historic oil strike on July 12 by the Talos Energy-Premier Oil-Sierra Oil & Gas consortium.
“Regulators should be focused on incentivizing participation because increased participation increases the government’s revenue,” Timothy Duncan, President and CEO of Talos Energy, told the audience at the Hotel Sheraton María Isabel. Talos and its partners became the first private drilling operation to strike oil since the launching of the Energy Reform. The Zama 1 site, located near the coast of Tabasco, is estimated to produce between 1,400 and 2,000 million boe.
The panel was stacked with industry heavyweights Duncan; Gregory Hebertson, Vice President Western Hemisphere Exploration and New Ventures of Murphy Oil Corporation; Carlos Morales Gil, CEO of PetroBAL; and Andrés Brugmann, Country Manager Mexico of Fieldwood Energy. Director General of Mexico Business Publishing Jeroen Posma moderated the discussion.
The Talos achievement suggests that the Rounds are solidly designed, and in themselves show the world Mexico’s potential, said Morales Gil. “The Rounds are a recognition of Mexico’s geological potential,” he said.
Opportunity often goes hand in hand with challenges. As Mexico’s market transitions from a PEMEX monopoly to a competitive playing field, the supply chain needs to adjust to this major shift. “Transporting and marketing oil is a complex process, with many different levels of negotiation,” Brugmann said. Local procurement service companies need to understand this and adapt their offer to the wide array of business models of the industry’s new players.” Added Duncan: “We have to design our supply chain in a way that it phases in different vendors.”
As part of Mexico’s energy-supply security, there is a clear desire to take oil production and the industry’s activity to a level that meets the country’s energy requirements. “If there is an intention of increasing the amount of activity in the industry, one way of doing so could be to reduce the size of the auctioned blocs to have more people committed with more activities,” said Morales Gil. But that objective also entails a high level of complexity. “Collaboration, commitment and transparency in the industry are key to stimulate activity and to ensure the service sector’s growth,” said Hebertson.