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Pemex: Lewis Energy Bids $340M on Seventh Burgos Block

Pemex: Lewis Energy Bids $340M on Seventh Burgos Block

Lewis Energy Group, headquartered in San Antonio, on Wednesday bid to produce natural gas in Mexico's Burgos Basin for Petroleos Mexicanos (Pemex). Lewis, the only bidder, estimated it would invest about $340 million over 20 years to produce 40 MMcf/d.

The bid is to produce gas from Burgos' Olmos block, which is located along the Texas border. Olmos is the seventh block tendered by Pemex under its new multiple service contracts (MSCs), which allow outside contractors to run manage gas leases for the nationally run Pemex. Under the MSC program, Pemex owns the gas produced and pays set prices for the services.

If Pemex approves Lewis' technical proposal, the economic bid would be opened on Thursday. Sergio Guaso, who runs the MSC program for Pemex, said he was "confident" about the Lewis proposal, "because they know the area; they have the technology and the expertise."

Work on four blocks tendered by Pemex late last year already is under way, according to Pemex. Two other blocks received no bids. Pemex plans to reissue tenders for the Corindon-Pandura and Ricos blocks as soon as February. The four blocks tendered have investment commitments of $4 billion to produce 400 MMcf/d. Corindon-Pandura and Ricos, two of the largest blocks, would require a combined investment of $5.6 billion, according to Pemex.

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