UPDATE 3-First phase of historic Mexico oil auction misses expectations

miércoles 15 de julio de 2015 19:53 GYT

(Adds quotes, details on total government take and expected investment)

By Adriana Barrera and David Alire Garcia

MEXICO CITY, July 15 (Reuters) - Mexico auctioned only two of 14 blocks in a pivotal oil and gas tender on Wednesday, falling far short of the government's modest expectations as it begins to open up the long-nationalized industry to private investment.

Both the shallow water exploration and production contracts were awarded to the same consortium made up of Mexico's Sierra Oil & Gas, U.S. firm Talos Energy and Britain's Premier Oil.

The other 12 blocks received no bids, or none that cleared the bar set by Mexico's finance ministry, marking an inauspicious debut for the rollout of President Enrique Pena Nieto's signature economic reform.

"Without doubt, the start of round one didn't have the momentum we were hoping for," said Juan Carlos Zepeda, president of Mexico's oil regulator, known as the CNH.

Still, Zepeda called it "a solid start," pointing to a transparent process and the fact that seven private firms bid.

In the second block up for grabs, the government said the consortium would ultimately pay a total government take of between 74 and 86 percent of profits. In the seventh block, it saw the figure at between 83 and 88 percent of profits.

The government take is the sum total of the contract's fiscal terms, including a variable royalty, income tax, surface rental fee and the percentage of pre-tax profits.   Continuación...