Definitive Bidding Guidelines And Production Sharing Contract First Call To Bid–Round One- Shallow Waters - Government - Mondaq Mexico - Mondaq Business Briefing - Books and Journals - VLEX 575847846

Definitive Bidding Guidelines And Production Sharing Contract First Call To Bid–Round One- Shallow Waters

Author:Mr Edmond Grieger, Claus von Wobeser, Marco Tulio Venegas Cruz and Ariel Garfio
Profession:Von Wobeser & Sierra, S.C.

On May 29th and June 9th, 2015, the National Hydrocarbons Commission (CNH) made the last amendments to the Bidding Guidelines for the First Invitation to Bid, and the final draft of the Production Sharing Contract (the Contract.) With this, the bidding process's rules and conditions, and the final draft are already defined, giving legal certainty to all bidding process participants (the Bidders.)

  1. Bidding Guidelines:

    1. Removal of Restrictions.-

      Among the most relevant amendments made by the CNH are those related to the removal of a cap on the numbers of blocks for which a company or consortium can bid, which had been previously limited to five. In this regard, the CNH allowed the Bidders to bid for the total number of blocks (fourteen) related to the exploration and extraction in shallow waters.

      Likewise, the restriction related to the operator having the higher participation within a consortium was eliminated, however the latter must retain at least one third of such participation. Also, the CNH removed the obligation for the participants to destroy, once the bidding process ends, the information gathered in the public bidding process data room. The commercial use of such information can only be authorized through written consent by the CNH.

    2. Significant Adjustments.-

      Regarding the bidding guideline's adjustments, the CNH approved for consortium financial partners to hold a greater share than the operator and the entity responsible for the project. The Bidders also must include in the economic offer envelope, an additional envelope indicating the amount offered in cash in case of a tie, which will be only opened in event of a tie.

  2. Final Draft of the Production Sharing Contract:

    1. Preliminary Investigation and Conciliation.-

      The CNH conducted an analysis in greater detail taking into account the observations and comments that were made by the Bidders, and decided to include in the Contract two-import additional concepts. The first one is related to the inclusion of a clause called "Clause of Preliminary Investigation," which is intimately linked with the administrative rescission provided for under article 20 of the Hydrocarbons Law. The second one relates to the expansion and use of alternative methods of dispute resolutions through conciliation, which brings, in one way or another, a sense of strength of article 21 of the Hydrocarbons Law.

      By including the "Clause of Preliminary Investigation" in the Contract, the CNH brought into...

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