The evolving shape of upstream reform in Mexico

MARKET NOTE 174 seeks to take stock of the rumors that were floated in the FT and WSJ on November 6 about the government’s willingness to go beyond a profit-sharing oil regime.

We wonder if the harsh lesson of Brazil’s Libra auction has come home: If American oil companies do not participate in your bid round, something’s wrong in your oil regime. For Brazil, it may be a small thing that neither BP nor any American IOC participated; but for Mexico it would be regarded as an outright failure if a tender under a new oil regime were to have that outcome.

And, for Mexico, not all American oil companies are the same: Mexico needs the approval of the investment committee of Exxon Mobil, the oil company with the greatest weight and clout on Wall Street. Even AMLO seems to recognize the importance of Exxon for the government.


Written by

Mexico Energy Intelligence

Baker & Associates offers niche-market business and policy intelligence related to Mexico's oil and gas, power and chemical industries. Over 1,000 reports have been issued in the last 20 years. Subject matter expert and publisher George Baker, who directs the firm, has carried out consulting assignments starting in the late 1970s at the height of the Oil Boom in Mexico. He brings bilingual and bicultural skill-sets to understanding and responding to challenges of business and public policy, coupled with a deep familiarity with the history and idiosyncrasies of the Mexican operating environment.