Two of three oil and natural gas exploration and production (E&P) farmouts on offer with Mexico’s Petroleos Mexicanos (Pemex) were snapped up Wednesday in an auction organized by upstream regulator, the National Hydrocarbons Commission (CNH).

CNH late last month authorized 10 E&Ps to compete in the auctions to jointly explore the Ayin-Batsil, Cardenas-Mora and Ogarrio areas with national oil company Petroleos Mexicanos (Pemex).

By far the fiercest bidding was for the onshore Ogarrio block in the state of Tabasco.

Germany’s DEA Deutsche Erdoel AG won the Ogarrio farmout with an offer for an additional 13% royalty and a cash payment of $213.9 million, the largest of its type ever paid in a CNH auction.

Also bidding for the Ogarrio block but losing to DEA were California Resources Corp., partnered with Mexico’s PetroBAL, as well as Ogarrio E&P of Chile and Argentina’s Tecpetrol, which participated with Galem Energy of Mexico.

The Cardenas-Mora farmout, also competitive, was awarded to Cheiron Holdings Ltd. of Egypt, a company that has been providing services for Pemex for several years. Cheiron’s bid was a maximum additional 13% royalty and $41.5 million in cash, in addition to a $125 million carry to compensate for development already done in the block by Pemex.

Cheiron was described by Pemex Director-General Jose Antonio Gonzalez Anaya as “a massive producer of natural gas.”

Losing out to Cheiron was a consortium consisting of Canada-based Gran Tierra and Mexico’s Sierra Blanca, with a bid of 5.09% in royalties and zero cash.

No bids were received in the first farmout auction of the day for the Ayin-Batsil, two fields in the shallow waters of the southern Gulf of Mexico, where about two thirds of Mexico’s crude oil is produced.

The CNH auctions have a history of only a little more than three years, following the energy reform that ended almost eight decades of state monopoly.

“It’s not a long time, but it’s an awful lot of money and it indicates that farm outs make a lot of sense for us,” Gonzalez Anaya told reporters.

The government reckons the farmouts awarded on Wednesday will provide it with an 84% take of the profits generated by the contracts. Bidders were competing for a 50% operating stake.

Cardenas-Mora and Ogarrio, both mature onshore fields, contain 93 million boe and 54 million boe, respectively.

The farmouts are currently producing, with Ogarrio producing up to 11,000 b/d of extra-light oil and 25 MMcf/d of wet gas. Cardenas-Mora is producing about 10,000 b/d of light crude, Gonzalez Anaya said.

He said production should increase in each of the farmouts by up to about 30% within “a few years.”

The only previous Pemex farmout was awarded last December to Australia’s BHP Billiton Ltd. for the deepwater Trion discovery in the Perdido Fold Belt close to the maritime border with the United States.

Wednesday’s auction, like all CNH auctions, was broadcast live on YouTube.