Italy’s Eni and Russia’s Lukoil have signed a farm-out agreement for the transfer of participating interests in three exploration licenses in Mexico’s shallow waters.
According to the agreement, Eni will give Lukoil a 20 per cent stake in the Production Sharing Contracts (PSC) in both Area 10 and Area 14, and will acquire a 40 per cent stake in Lukoil’s PSC for Area 12. The objective of the deal, in light of the close proximity of the blocks, is to diversify the exploration risks, accessing wider opportunities and increasing mutual operational synergies.
The new joint ventures will be as follows: Area 10 (Eni 80 per cent operator, Lukoil 20 per cent); Area 12 (Lukoil 60 per cent operator, Eni 40 per cent); Area 14 (Eni 40 per cent operator, Citla 40 per cent and Lukoil 20 per cent).
The agreement is subject to the approval by the Mexican authorities.
The three blocks are all located in the prolific Sureste Basin and they were awarded to Eni and Lukoil in 2017 as the outcome of an international competitive bid round called “Ronda 2.1”, issued by the National Hydrocarbon Commission (CNH). The exploration drilling campaign is planned to start as early as mid-2019.