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Abu Dhabi, UAESaturday 23 June 2018

As oil prices rise, global majors eye Mexico's untapped waters

Twenty-five global majors are registered to big for 29 deep-water plots across the southern Gulf of Mexico

Exxon Mobil, one the world’s biggest drillers by market value, plans to bid in the Mexico’s January 31 deep-water auction. Mark Humphrey / AP
Exxon Mobil, one the world’s biggest drillers by market value, plans to bid in the Mexico’s January 31 deep-water auction. Mark Humphrey / AP

As the price of oil rises, an international rush is on for Mexico’s untapped deep-water riches.

The who’s who of the oil world - led by Exxon Mobil and Royal Dutch Shell, the world’s two biggest drillers by market value - are lining up to bid in the country’s January 31 deep-water auction.

And the interest is international in scope, drawing Chevron from the US, the UK.’s BP, Norway’s Statoil, France’s Total, Australia’s BHP Billiton, Russia’s Lukoil and China’s Cnooc, among others.

The total: 25 registered to bid for 29 deep-water plots across the southern Gulf of Mexico, the nation’s regulator said on Thursday. It shouldn’t be a surprise. The areas up for grabs are estimated to hold as much as 4.2 billion barrels of crude oil in untapped deep waters where 76 per cent of Mexico’s prospective resources may lie, the energy ministry has said.

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In the country’s first-ever deep water oil auction last year, eight of the 10 blocks auctioned were won by international crude majors. The stakes are higher for the January 31 bid round, which aims to auction almost three times the amount of fields as last year.

At the same time, it arrives on the heels of two recent 1 billion barrel-plus discoveries in Mexico's shallow waters this summer, and as the price of oil has risen. Brent crude, the global benchmark, has jumped from $44.43 a barrel in November 2016, to close at $63.93 on Thursday, a 44 per cent rise.

Friday is the last day for companies to qualify to participate in the auction. Then the countdown will begin.