“We commend Mexico on a historical, successful bid
round; for Shell, today’s win marks a competitive, deepwater
entry in Mexico,” said Andy Brown, Shell upstream director.
“The proximity and technical similarity of this opportunity
to our leading position in the US Gulf of Mexico will allow
us to benefit from and build upon decades of experience,
complementing our position in the region.”
QP won exploration rights for Blocks 3, 4, 6, and 7 in the
Perdido basin as part of a consortium comprising Shell, op-
erator with 60% interest, and QP, with 40% interest.
QP also won the exploration rights for Block 24 in the
Campeche basin as part of a consortium comprising Eni
SPA, operator with 65% interest, and QP, with 35% interest.
Saad Sherida Al-Kaabi, QP president and chief executive
officer, said, “Winning these offshore exploration blocks in
Mexico, which contain some of the most promising hydro-
carbon prospects in the world, is an important achievement
for [QP]. It represents another step in implementing our
strategy to expand our international footprint, and to pursue
Latin America as an important core area for [QP].”
Round 2. 4 comes at the same time as several other deep-
water rounds worldwide. As WoodMac expected, acreage in
the Perdido and Salinas Sureste areas proved to be the most
sought after in this latest round.
Cortez said, “The majors used this round to increase acre-
age exposure to some of the most attractive deepwater areas
in the world.”
The analyst said the round validated the Mexican govern-
ment’s approach to setting competitive fiscal terms, which
promoted active bidding, driving up the value of acreage.
Mexico raised more than $500 million in cash payments.
“Mexico has not only opened its doors to foreign direct
investment but has also made a point of listening to industry
and learning from each round. One measure of success is
the number and quality of companies now active in Mexico’s
offshore. The corporate landscape is very diverse,” Cortez
ExxonMobil cites US tax reform as
catalyst for $50-billion outlay plan
ExxonMobil Corp.’s US upstream earnings recorded a loss of
$429 million for full-year 2017, excluding US tax reform and
impairments. With $7.6 billion of tax reform benefits and
$521 million in asset impairments, the supermajor reported
$6.6 billion in US upstream earnings in 2017.
US federal tax reform in the fourth quarter resulted in
a noncash earnings gain of $5.9 billion, spurring the su-
permajor’s plan to invest $50 billion in the US over the next
OGJ left messages at PDEP’s offices but could not verify
immediately that the agency has made such a move.
“This is a tired proposal for a duplicative tax that isn’t
about paying one’s fair share or filling a gap in existing revenue opportunities. The benefits that the governor seeks
are already happening,” said Stephanie Catarino Wissman,
executive director at Harrisburg-based API-PA, which is an
American Petroleum Institute affiliate.
“To suggest that Pennsylvanians aren’t already realizing
the benefits of an energy tax is misleading. Impact tax dollars are helping to fix our roads, fund critical infrastructure
projects and invest in our communities, thereby reducing
tax burdens on Pennsylvania families,” Wissman said. “In
fact, this year, the natural gas industry is expected to add
$219 million in paid impact taxes to the commonwealth, up
more than $46 million over the amount collected last year.”
Weaver said, “Nothing has changed in the state’s cumulative tax structure and impact fee program to make an additional severance tax anything more than a plan to stifle the
growth of an increasingly important segment of our state’s
economy. We still have the country’s highest corporate net
income tax, and we continue to compete for investment
against states with huge shale gas reserves and whose corporate and personal tax rates are far less than those in the commonwealth, including Texas, which collects no corporate or
personal income taxes.”
Mexico awards 19 blocks
in record Deepwater
Round 2. 4
Mexico’s National Hydrocarbons Commission reported
the award of 19 blocks of the 29 on offer in the Perdido,
Campeche, and Mexican Ridges areas in the Mexican Gulf
of Mexico. Round 2, Phase 4 (Round 2. 4) was held Jan. 31
in Mexico City.
Round 2. 4—which was dominated by Shell Exploracion
y Extraccion de Mexico SA de CV picking up nine key blocks
either alone or with partners—was called by one analyst a
Maria Cortez, Latin America upstream research manager
for Wood Mackenzie, noted, “Bidding was competitive, with
Shell the most aggressive bidder, taking nearly half of all
blocks awarded. In the Perdido area, the company won five
of six awarded blocks.”
Shell won four exploration blocks on its own, one with its
partner Pemex Exploracion y Produccion, and four with its
partner Qatar Petroleum International Ltd. (QP). Shell will
be the operator of all nine blocks, which cover a total area of
18,996 sq km.