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The Mexican Market Is Now An O & G Consulting Paradise

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The Mexican market is now an O&G consulting paradise. Former PEMEX staff portrait themselves as seasoned Oilmen, Oil Field Service call themselves E&P experts and everyone else falls into one of three buckets according to their “experience” size of their wallet and/or delusions of grandeur.

There are the consultants or people who work(ed) with organizations with contracts in the national energy sector, there are the expert’s or people who claim to have worked with providers of PEMEX/CFE in the past and finally the Gurus, people who have worked for a subsidiary of PEMEX/CFE or contracted sometime in the past for them.
A few good men (E&P experts)
While there are many O&G people working in Mexico the true E&P experts are extremely rare, …show more content…

What we are left with is pure profit at a Contango scenario as the futures are priced higher than spot prices for crude across the board.
Mexico E&P only for Billionaires?
Most Mexican investors base their assumptions of a capital requirement to participate on the sector on the USD$1B mark thanks to the Round 1.1. When in fact investors can partner with FEP to acquire low risk (brownfield) E&P projects valued in excess of NPV USD$300mm for as low as USD$ 1mm.
FEP has access to acquisition opportunities with CAPEX below USD$60mm, these assets are capable of providing significant returns even at USD$35/barrel with average lifting cost of USD$10/barrel, and downside NPV valuation above USD$300mm. So are there similar opportunities in Mexico? You betcha!
De-risking methodology #1 selectivity
By focusing on asset selectivity of projects rather than building empires we can achieve better risk adjusted returns and sustainability. FEP risk management framework flips the process upside implementing time proven methodologies across the board from operational and financial process. PWC article on CAPEX Selectivity.
The right ingredients are not enough…
While it is true that Mexico has the right ingredients to become an energy super power, including armies of cheap labor, prolific basins capable of producing at the lowest cost, and vast amounts of capital to fund

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