MX Oil has signed a joint venture (JV) agreement with Geo Estratos to identify, evaluate, explore, develop, and produce hydrocarbons in Mexico.
The Geo JV is a product of and supersedes the agreement signed by MX Oil and Nogal in May.
As part of the agreement, any concession or project awarded to the Geo JV will be held under a separate firm (JV company).
MX Oil will own 51% interest in the JV company while the remaining 49% will be held by Geo.
MX Oil will provide access to funding for the delivery of specific approved projects by the Geo JV including the E&P assets acquisition.
It also includes the provision of oil services in Mexico and any pre-bid expenditure needed ahead of a formal bid for concessions.
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By GlobalDataThe deal requires Geo to provide any seismic or asset information required to the concession or project.
MX Oil chief executive officer Stefan Olivier said: "We have an early mover advantage in Mexico and this transformational JV with Geo ideally positions MX Oil to capitalise on the country’s vast hydrocarbon potential, which is estimated to hold 13 billion barrels of recoverable oil resources.
Geo also has a comprehensive in-house database covering Mexico’s geology and hydrocarbon formations and an extensive list of concessions that will be of major benefit to MX Oil.
"We are about to start evaluating three of these to determine whether MX Oil will elect to participate alongside Geo in the bidding round and, subject to the outcome, in their subsequent development."
MX Oil has also signed an agreement with Northcote Energy, which has the right to participate at a level equal to 20% of the company’s interest in any concession or project in Mexico.
