Mexico Launches Drilling Tenders For Challenging Oil Basin

MEXICO CITY -(Dow Jones)- Mexico’s state oil firm hopes to turn a long-ignored oil basin into a major producer as the country’s traditional fields run dry.

This month Petroleos Mexicanos, or Pemex, is collecting bids for two drilling tenders for the Chicontepec basin, according to Compranet, the government’s procurement Web site.

Experts say it will be a difficult task for Pemex to reach its production target of 100,000 barrels a day by the end of this year at the geologically challenging area.

Pemex’s newfound interest in Chicontepec underscores how the company needs to spend more money just to halt a steady decline in oil output that started in 2004. If Pemex fails to tap new fields, the country’s oil exports will dry up over the next decade, putting Mexico at risk of a fiscal crisis and leaving the U.S. increasingly dependent on oil imports from the Middle East.

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