Oil and Gas Latin America
ACTIVITY TO WATCH ACROSS THE REGION
EIC Connect
Make your mark in Latin America Looking to expand into Latin America? Maximise opportunities at EIC Connect Mexico Energy Forum
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s we enter a new decade, Latin America’s oilproducing nations are increasing efforts to attract foreign investment amid an unprecedented wave of free-market energy reforms gaining traction across the region. Mexico’s populist president Andrés Manuel López Obrador is investing billions into the struggling state-owned Pemex. Argentina’s new Peronist government is hailing a new shale oil development in Patagonia as a lifeline and Brazil’s administration has touted multi-billiondollar oil rights auctions as transformative. Smaller South American economies have also caught on. This year Guyana will join crude-producing nations as new offshore fields come on stream, while Colombia is looking to boost declining output.
EIC goes to Mexico The US Gulf of Mexico now appears to be springing back to life after years in virtual hibernation, as the region’s production rises and oil companies prepare for future growth even amid uncertain oil prices. In December 2013, Mexico amended its constitution to allow both local and foreign private investment into the energy sector for the first time since its nationalisation in 1938. The reforms permitted international energy companies to operate in Mexico and included provisions for competitive production sharing contracts and licenses. In addition to increasing the demand for technology and technical expertise for the development of upstream deepwater and shale oil and gas fields, the energy reform also allowed for greater private investment in retail fuel distribution.
Seven years on, the López Obrador administration has indicated it will respect the current legal framework of the energy reform, which provides greater certainty to oil and gas contractors already in Mexico.
EIC Connect Mexico Energy Forum The EIC will be hosting its Connect Mexico Energy Forum 2020 on 27 February in Mexico City. The event will give contractors and suppliers in the oil and gas industry the opportunity to meet with leading operators, developers and OEMs, and explore growth prospects and upcoming projects to help expand their business within the region. Attendees will gain an insight into Mexico’s energy sector from business and political leaders, access to conference supply chain briefings, and one-to-one appointments with potential buyers, in addition to networking and sponsor opportunities. EIC Connect consistently attracts a high-profile audience from across the entire energy spectrum, all sharing a genuine desire to meet and do business with companies from the UK. Last year EIC’s inaugural forum in Mexico City received 130 attendees and 11 sponsors/partners. This year’s forum will be opened by Her Majesty’s Ambassador to Mexico, Corin Robertson. Speakers include Arendal, BHP Billiton, Brunel, DIT, Dragados Offshore, EIC, Grupo Mexico, iPS Powerful People, Kiewit, McDermott, Modec, Scottish Development International TransOcean, Turner & Townsend and UK Export Finance representatives. A trade delegation has been organised in partnership with the Department for International Trade and Scottish Development International to coincide with the event.
COLOMBIA This year Colombia’s oil and gas industry is set to take off as efforts to increase exploration and production move ahead amid problems with community relations and security. Colombia has around 2Bbbl of oil reserves and produces about 880,000bbl/d of crude, half of which are exported. Energy giant Noble is set to drill its first Colombian well this year in the Caribbean and is qualified to bid in the current oil round, which includes five offshore blocks. Elsewhere in the offshore, in 2020, Petrobras and Ecopetrol are looking to drill a well in the offshore Tayrona Block.
ECUADOR Ecuador aims to increase its current oil production from around 550,000bbl of crude oil to nearly 600,000 this year, when its departure from the Organization of the Petroleum Exporting Countries (OPEC), announced in October 2019, becomes effective. On average, the country is expected to produce between 543,000bbl and 550,000bbl, a figure above the OPEC limit of 528,000bbl. The goal, according to former Minister of Energy Carlos Perez, is to begin drilling and production in the Ishpingo field, on platforms A and B, which are outside the so-called ‘buffer zone’ of Yasuni, within six to eight months.
Looking to expand into Latin America? The EIC can help For those of you thinking about doing business in Mexico, please get in touch with the EIC Houston team (houston@the-eic.com). If you have plans for developing your business in the Latin American region, please get in touch with the EIC Rio de Janeiro team (clarisse.rocha@the-eic.com). Both teams will be happy to talk with you about EICLaunchPad services, which provide a low-cost, low-risk entry into the region. At EIC, we can provide you with serviced office facilities, meeting rooms and hot desks, as well as a virtual office service: everything you need to start building your business in the Latin American region.
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