Australia's BHP Billiton Wins Bidding for Stake in Mexico's Trion Oil Field
December 05 2016 - 12:37PM
Dow Jones News
By Robbie Whelan
MEXICO CITY -- Australia's BHP Billiton won bidding Monday to
partner with Mexican state oil company Petróleos Mexicanos in the
Trion deep-water oil field in the Gulf of Mexico in an auction in
which 10 other deep-water blocks are also being offered.
Billiton outbid BP PLC to become Pemex's first private partner
in exploration and production under Mexico's 2013 opening of the
oil industry.
Bids for 10 other deep-water blocks up for auction are due to be
opened later Monday.
For Trion, both Billiton and BP offered additional royalties of
4%, while Billiton offered an additional cash commitment of $624
million compared with $606 million offered by BP.
Billiton will have 60% of the project and Pemex 40%.
The auction is the fourth under the 2013 opening of the Mexican
oil industry, but the first for deep-water reserves and the first
to attract the interest of major oil companies.
The Trion field was discovered in 2012 and is thought to contain
about 485 million barrels of commercial reserves. Pemex's chief
executive, José Antonio González Anaya, said the state company
hopes that by 2025, the field will be producing around 120,000
barrels a day.
BHP Billiton is the world's biggest mining company by market
value and also has oil operations. Mr. González Anaya said he's
confident it will bring significant advantages such as technology
to Pemex.
"I'm happy that the bids were so close, and that there wasn't a
'winner's curse.' When bids are far apart sometimes winners may
think they offered too much," the executive said.
Write to Robbie Whelan at robbie.whelan@wsj.com
(END) Dow Jones Newswires
December 05, 2016 12:22 ET (17:22 GMT)
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