Despite tension between Mexico’s government and non-state energy firms, Houston-based Talos Energy Inc. maintains a bright outlook for private sector exploration and production (E&P) in the country, management said last week.

President Andrés Manuel López Obrador has upheld his pledge to honor the more than 100 E&P contracts awarded following the 2013-2014 market-opening energy reform, Talos CEO Timothy S. Duncan told analysts during the firm’s second quarter earnings call.

“I’ve always found comfort in that. That statement has been consistent.”

What’s more, Duncan said, due to budgetary constraints, Pemex alone will be unable to make the investments required to keep the country’s oil and gas production afloat.

He said the members of Amexhi, Mexico’s main...