A joint investment by London’s Premier Oil Plc, Houston-based Talo’s Energy LLC and Mexico’s Sierra Oil & Gas started drilling the Zama-1 well in May. This well is the first survey well to be founded by anyone else apart from Petroleos Mexicanos, a state-run management since 1938 when the country nationalized its energy business. For the first time in approximately 80 years, a private firm has located a new oil well in the waters of Mexico, signifying the latest step in the country’s effort to restore foreign competitors back into its energy industry.
The new oil well, located in the Sureste Basin in the state of Tabasco, contains nearly 100 million to 500 million casks of crude oil. The drilling process will probably take around 90 days at the cost of 16 million dollars. The three corporations secured rights to the venture in 2015, after the first bidding round while Mexico voted to bring back private investors in its dwindling oil sector. Tim Duncan, the Chief Executive Officer, and president of Talos stated that announcing such historical innovation in not more than two years following the acquisition of the block was a perfect indication of the benefits of allowing smaller enterprises to engage in essential reforms.
The basin’s structure shows that the project has a high environmental probability of success. Charlie Sharp, an analyst of Canaccord Genuity Ltd., noted that given all the suggestions for the market of Mexico, Zama-1 well is one of the incredible ventures in the sector this year. According to a statement by Premier, Talos Energy the operator of the well owns 35% of the shares, Premier 25%, and Sierra holds 25% of the investment.
Talos Energy is a private firm that deals gas and oil, and its focus is on the exploration and the acquisition of natural resource properties. It mainly focuses on the Gulf Mexico and Gulf Coast. The company enjoys the support of investment funds associated with Talos management, Riverstone Holdings LLC, and Apollo Global Management. Talos Energy owns reserves of an estimated 100 million BOE and generation of over 30,000 BOE daily gains to the benefit of the corporation.