As Mexico begins to open up its state-owned oil monopoly to private companies for the first time in 75 years, it’s moving cautiously and hitting a few snags.
Selling drilling rights that stretch over decades is a tough business, made more complicated by recent down trends in oil prices and the country’s inexperience in this arena.
“In today’s environment, it isn’t as urgent to be first in line,” says Tim Samples, a professor at the University of Georgia’s Terry College of Business.
The Mexican government is starting small in terms of selling rights. This first batch of fields in the Gulf of Mexico offer modest but low-risk shallow water projects.
“This is the low-hanging fruit,” Samples says. “It’s hitting a single.”
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