Mexico's hydrocarbon auction rules stifle participation

Author: Zoe Thomas | Published: 18 Aug 2015

High levels of transparency and strict adherence to rules set out last year may have been key factors in the underwhelming results from round one of Mexico’s hydrocarbon auctions.

Only two bids were accepted in the first public round of bidding for energy projects out of 14 contracts on offer and 49 companies that had expressed interest. Some of the world’s largest oil and gas companies, including Chevron, opted to stay out of the process.

Participants praised the Ministry of Energy for sticking to its prescribed rules. They also maintained a very high level of transparency, requiring all participant questions to be placed on record. But these tactics may have limited the number of bids. The uncertainty around this being the first process, compounded...