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Pemex, BHP Billiton deep water tie-up eyes first well by end of 2017

Staff Writer | March 6, 2017
The first-ever joint venture in Mexico's deep waters could begin drilling its first oil well by the end of this year.
BHP Billiton
Oil exploration   Some $11 billion in investments
In December, Pemex teamed up with BHP Billiton to develop its Trion block in the Gulf of Mexico, a partnership that was sealed on Friday in a signing ceremony presided over by Mexican President Enrique Pena Nieto.

Javier Hinojosa, Pemex's chief of exploration and production, said in an interview that the two partners could begin developing the project relatively soon.

The drilling of a so-called delimiting well "could happen by the end of this year," while a second, exploratory well would "certainly" go forward in 2018, Hinojosa said.

Both wells are part of a minimum work program set out in the 35-year license contract covering Trion, which also calls for the acquisition and processing of new three-dimensional seismic data.

BHP Billiton was selected to be Pemex's partner on the Trion block at a competitive auction in early December managed by the National Hydrocarbons Commission, Mexico's newly empowered oil regulator.

The partnership is the fruit of a sweeping sector overhaul finalized in 2014 that ended Pemex's decades-long monopoly and allows joint ventures in exploration and production of oil and gas with equity partners.

The Trion project is expected to require some $11 billion in investments over the course of its life. Pemex will not have to contribute funding for the project for at least the next three years.