Mexico-based Petroleos Mexicanos (Pemex) has decided to expand its business in the US, by setting up a new company (by the end of 2013) to explore and develop shale gas and deep-water oil.

The new company will represent Pemex’s first step in its quest to eventually become an international oil company.

Pemex CEO, Emilio Lozoya Austin, was quoted by The Wall Street Journal as saying: "Pemex will be starting a new company that will work on the shale-gas and shale-oil fields in the US and in the deep-water side of the US."

"The geology is similar and we can benefit from numerous areas of collaboration with international oil companies," Austin added.

The move is similar to the energy-overhaul proposed by Mexican President Peña Nieto, which will allow private companies to share in oil profits for the first time in 75 years.

The legislation aims to turn around a reduction in of production in Mexico and open up huge untapped hydrocarbon fields in deep waters off the Gulf of Mexico and in shale-rock formations.

In the past ten years, Mexico’s oil production has dropped from a high of 3.4 million barrels per day to 2.5 million barrels, even as the country has quintupled investment spending in Pemex.

Image: Pemex CEO Emilio Lozoya Austin. Photo courtesy of PEMEX.