Mexico: Energy Reform Round Zero And Round One

Last Updated: 17 September 2014
Article by Juan Carlos Machorro

On August 13, 2014 as a result of the announcement by the Federal Executive Branch in the act of issuing the package of federal legislation in energy matters on August 11, 2014, the head of the Ministry of Energy ("SENER") presented the results of the analysis of the request formulated by Petróleos Mexicanos ("Pemex") on March 17 on the development of certain fields, as part of the process called Round Zero, as well as the fields that will be included in the public bidding processes that will make up Round One.

This analysis was done by SENER, with the technical assistance of the National Oil and Gas Commission, and its purpose was to determine the technical, financial and operative capacity of Pemex to carry out activities of oil and gas exploration and extraction in particular fields.

Round Zero

The head of SENER indicated that Pemex was granted 100% of what it requested in the so-called "2P Reserves"1, which is to say the equivalent to 83% of all of such 2P Reserves of the country, which would represent resources for approximately 20.5 million barrels of crude petroleum. Furthermore, Pemex was granted 21% of the prospective resources2 of Mexico, the equivalent of 22,126 million barrels of crude, only 67% of what Pemex requested.

It was explained that the majority of the resources that were granted to Pemex are concentrated in shallow water deposits, while in deep water, where the oil company does not have experience, few fields were granted. In the case of deep water, 42% of the prospective resources were granted to it.

Among the areas granted to Pemex are Cinturón Plegado Perdido, in deep water in the north of the Gulf of Mexico, with 3,013 million bep.3 in prospective resources; Holok and Han, in deep water in the south of the Gulf of Mexico, with 2P Reserves of 397 million bep. and prospective resources of 1,824 million bep.; Burgos and Sabinas, land fields in northeast Mexico, with 2P Reserves of 425 million bep.; Ébano, Pánuco, Faja de Oro and Chicontepec, land fields in northeast Mexico with 2P Reserves of 3,815 million bep.; land fields on the southern coast of the Gulf with 2P Reserves of 4,579 million bep. and prospective resources of 5,913 million bep.; shallow water and extra-heavy oils, marine areas in the south and north of the Gulf of Mexico that include the petroleum fields of Cantarell and Ku Maloop Zaap, this block includes 2P Reserves of 11,374 million bep. and prospective resources of 7,472 million bep.; and non-conventional fields, in land areas in the east and north of Mexico with prospective resources of 3,904 million bep.

Round One

With respect to Round One, SENER resolved that 156 blocks will be offered, of which 96 correspond to exploration projects and 60 to extraction. Among the areas assigned are Perdido, in deep water in the Gulf of Mexico, Chicontepec (non-conventional fields and southeast basins) and some blocks in the Burgos Basin. The Round One fields that were indicated will be discussed with private sector companies and the definitive list will be issued this November.

It is estimated that this November 14 the preliminary terms for bidding will be presented, on which date SENER must know exactly what fields it will request bids on and their characteristics. It will also provide the details on the fiscal model and the contracting model, in what will be the first involvement with private sector companies. Subsequently, in the month of February 2015 the terms for bidding will be presented and it is estimated that between May and September of 2015 the awarding of such bids will be made known. Finally, it is estimated that in September 2015 the deep water fields will be delivered, it being expected that before that date the mature fields, shallow water, land and heavy crude fields will be granted.

SENER expects that with these open bids (including those in which the private sector may or must be associated with Pemex) will attract 50,000 million dollars of investment between 2015 and 2018. Even though the above described agenda may seem aggressive, we consider that it is feasible since it is basically in the hands of the Federal Executive Branch to achieve the targets set.


1 The reserves are defined as those quantities of oil and gas that are expected to be recovered commercially from known accumulations as of a particular date. Therefore, the concept of reserves includes only the recoverable and exploitable part of petroleum resources in a particular time period. Thus, it is important to clarify that some of the non-recoverable portions of the original volume of oil and gas can be considered reserves, depending on the economic, technological or other conditions, which change them into recoverable volumes. The proven reserves, or 1P reserves are defined as the volume of oil and gas or associated substances evaluated at atmospheric conditions and under current economic conditions, that is estimated will be commercially recoverable on a specific date, with reasonable certainty, derived from the analysis of geological and engineering information. There are two types of proven reserves: 1) those developed, which are expected to be recovered from the existing wells with the current infrastructure and with moderate investment costs; and 2) those undeveloped, which are defined as the volume it is expected to produce with future infrastructure and in future wells. There are also two types of unproven reserves: 1) the probable reserves and 2) the possible reserves. The first are made up of those volumes of oil and gas for which the analysis of the geological and engineering information suggests that they are more likely to be commercially recoverable than not. If probabilistic methods are used for their evaluation there will be at least a 50% probability that the quantities to recover are equal to or greater than the sum of the proven reserves plus the probable reserves. The 2P Reserves, therefore, include the sum of the proven reserves plus the probable reserves. The second, in contrast, are characterized by having a commercial recovery, estimated from the geological and engineering information, less than is the case of the probable reserves. Thus, if probabilistic methods are used, the sum of the proven reserves, probable plus the possible will have at least a probability of 10% that the quantities actually recovered are equal or greater. Consequently, the 3P reserves are calculated from the sum of the proven reserves plus the probable plus the possible.

2 The prospective resources are those whose existence can be inferred from technical information.

3 Barrel equivalent of petroleum.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions