On July 20, 2016, Mexico's National Hydrocarbons Commission (Comisión Nacional de Hidrocarburos) ("CNH") published in the Mexican Official Gazette (Diario Oficial de La Federación) the bid guidelines for international public tender CNH-R02-L01/2016. This Round Two auction will comprise 15 shallow-water blocks located in the Gulf of Mexico in Tampico-Misantla, Veracruz, and the Southeast Basins (Cuencas del Sureste), as follows:
Location Contract Area Surface (km2) Tampico-Misantla 1 544.4 2 548.7 3 546.4 4 556.8 Veracruz 5 824.5 Cuencas del Sureste 6 559.3 7 590.8 8 586.0 9 562.3 10 532.6 11 532.7 12 521.1 13 564.6 14 466.4 15 971.6 Each block awarded through this auction will be subject to a Production Sharing Contract having a term of 30 years, subject to two extensions of an additional five years each. The exploration period under each PSC will be four years, also subject to extension by up to an additional two years. The evaluation period for any discovery will be two years and the development period will be between 22 and 32 years, depending on extensions.
The Mexican Ministry of Energy estimates that each block will require an investment of approximately US$750 million to develop.
The bid guidelines require potential operators of the blocks to meet the following criteria, among...