MEXICO CITY, March 25 (Reuters) - As Mexico opens up its oil sector to private producers for the first time in decades, the initial set of contracts up for grabs later this year will feature extended exploration periods, the country’s oil sector regulator said on Wednesday.
The change to the draft production-sharing contracts for 14 shallow water exploration projects will allow companies another year to satisfy requirements that they drill a field’s first test wells, said Juan Carlos Zepeda, head of Mexico’s national hydrocarbons commission.
“In this new version... the exploration phase will be four years instead of three with a possible extension of two years,” said Zepeda, before the change was approved by the commission.
Oil companies had criticized the terms of the original draft contract’s initial exploration phase, which required at least two completed wells in the first three years or the company risked having the 25-year contract rescinded.
Earlier this month, the regulator voted to modify the shallow water contracts to give companies a bigger share of profits as well as more flexible work requirements no longer linked to fixed upfront investment commitments, but instead emphasize the number of wells drilled.
The so-called Round One contract tenders are among the first steps of a sweeping energy reform finalized last year that ended the decades-long monopoly enjoyed by state-run oil company Pemex and promise to reverse a decade long slide in crude oil output. (Reporting by David Alire Garcia; Editing by Lisa Shumaker)