Over the past eighty years, Mexico has not allowed foreign companies to drill for oil off of its shores, as the country nationalized oil in 1938.. However, on May the 30th, a private company gained a well in Mexican waters, a joint venture between Premier Oil of London, Talos Energy from Houston and Sierra Oil & Gas, from Mexico. The well, called Zama-1, holds an estimated 100 to 500 million barrels of crude oil, a huge amount. A geological analyst from Edison Investment Research said that the structure of the well gives it a “high geological chance of success,” which is key in today’s oil industry after dozens of well-publicized accidents.
The implications of this development on the Mexican market are potentially huge for the Mexican market. It represents a big potential win for foreign oil companies as well as private Mexican companies, and an analyst for Cannacord Genuity called Zama-1 “one of the most interesting exploration wells” of the year.
Houston-based Talos Energy owns a 35% stake in the venture, behind only Premier Oil, and are also the operators of the well. They are a private oil and gas company focused primarily on oil in the Gulf Coast and the Gulf of Mexico. Founded in 2012, they are backed by Apollo Global Management and Riverstone Holdings LLC, who awarded Talos $600 million dollars at the company’s inception.
In 2013, Talos acquired Helix Energy Solutions Group subsidiary Energy Resource Technology Gom, Inc (ERT). This represented a major acquisition, as ERT’s assets represented 16,155 barrels of oil per day in the Gulf of Mexico. Talos is strongly committed not only to meet the global demand for oil, but also to conduct their drilling in ways that are environmentally friendly and safe for their workers. Talos’ Commercial Manager for Mexico, was last year named an Oil & Gas Investor Thirty under 40 thanks to Talos’ role as the first foreign drilling operator in Mexico since 1938.
For more information follow Talos Energy on Facebook.