An American energy exploration company sunk an oil well off the coast of Mexico earlier this year – it’s the first time foreign investors have been allowed to drill in Mexican territory in 80 years.
Houston-based Talos Energy, along with two partners, were the first to be allowed back into Mexican territory since that country nationalized its oil industry in 1938. Mexican government officials are determined to revitalize its oil industry with historic reforms welcoming foreign investors.
Also historic is the fact that Talos struck pay dirt. Drilling operations off the coast of Tabasco broke through to a well with an estimated cache of 1.5 to possibly two billion barrels of oil. Original estimated suggested the site might yield 500,000 million barrels.
The new well is called the ZAMA-1. The find is in 546 feet below the surface in the Sureste basin. ZAMA-1 was drilled to vertical depth of 11,000 feet. Workers have set a liner to protect the new discovery ahead of plans to drill additional exploration targets as deep as 14,000 feet.
An oil field the size of ZAMA historically produce more than 100,000 barrels per day. After Talos and its partners recoups costs, Mexico will receive royalties and taxes worth 80% of all oil and gas produced. That may add up to about $1 billion annually.
Talos Energy partnered with London’s Premier Oil and Mexico’s Sierra Oil and Gas company in the three-way effort. Talos will be the operator of the well and enjoy a 35% stake. Sierra Oil holds 40% and Premier will have 24% of the project.
The Mexican site opens up a new era for Talos Energy which has long concentrated its efforts along the shores of Texas and Louisiana. Now Mexican national waters are part of its portfolio as well.
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