More than two years after the passage of the energy reform, one of its critical elements — the so-called incentivated or integrated service contracts for oil exploration by private sector contractors– appears almost ready. The Pemex board agreed yesterday to hold a special board meeting on the 16th to consider and give final approval to the new contractual mechanism. These contracts are viewed by the Government as critical for enlisting the support of third-party contractors for exploration and development of oil and gas fields, while respecting the constitutional prohibitions on risk contracts and production sharing agreements. The incentivated contracts provide for two kinds of payments: one based on reimbursement of costs and the second based on the amount of petroleum discovered. This latter provision is being challenged as unconstitutional by the Chamber of Deputies and the matter is with the Supreme Court.
If the board endorses the contracts, the official in charge of the new contracts Sergio Guaso said Pemex expects to start awarding contracts based on the new mechanism in 3Q11.
Pemex plans to hold four bidding rounds using the new contracts. The first will be to reactivate the mature Magallanes, Carrizo and Santuario fields in the southern region; the second for mature fields in the north; the third in the Chicontepec region; and finally, in the deep waters of the Gulf.