+353-1-416-8900REST OF WORLD
+44-20-3973-8888REST OF WORLD
1-917-300-0470EAST COAST U.S
1-800-526-8630U.S. (TOLL FREE)

Mexico Upstream Fiscal and Regulatory Guide

  • PDF Icon

    Report

  • 36 Pages
  • December 2019
  • Region: Mexico
  • GlobalData
  • ID: 4898130
Description Jump to:
Mexico Upstream Fiscal and Regulatory Guide

Summary

The administration of President Lopez Obrador is expected to clarify to foreign investors whether it intends to close the door on international investments in the oil and gas sector after in December 2018 it cancelled new licensing rounds until at least 2022. In the meanwhile, Congress has recently modified some articles of the Hydrocarbons Revenue Law reducing Pemex’s profit sharing duty from the current 65% to 58% in 2020 and then to 54% in 2021.

Reducing the profit sharing duty may help Pemex to obtain liquidity and fund its obligations currently jeopardized by negative free cash flow and high debt. With no planned licensing rounds, service contracts migrations, and farm-outs, the government is looking to rely on Pemex for upstream development. Pemex offers new integrated service contracts to support development, but it will retain operatorship and contractors will receive a cash fee based on production.

“Mexico Upstream Fiscal and Regulatory Guide”, presents the essential information relating to the terms which govern investment into Mexico’s upstream oil and gas sector. The report sets out in detail the contractual framework under which firms must operate in the industry, clearly defining factors affecting profitability and quantifying the state’s take from hydrocarbon production. Considering political, economic and industry specific variables, the report also analyses future trends for Mexico’s upstream oil and gas investment climate.

Scope

  • Overview of current fiscal terms governing upstream oil and gas operations in Mexico
  • Assessment of the current fiscal regime’s state take and attractiveness to investors
  • Charts illustrating the regime structure, and legal and institutional frameworks
  • Detail on legal framework and governing bodies administering the industry
  • Levels of upfront payments and taxation applicable to oil and gas production
  • Information on application of fiscal and regulatory terms to specific licenses
  • Outlook on future of fiscal and regulatory terms in Mexico

Reasons to buy

  • Understand the complex regulations and contractual requirements applicable to Mexico’s upstream oil and gas sector
  • Evaluate factors determining profit levels in the industry
  • Identify potential regulatory issues facing investors in the country’s upstream sector
  • Utilize considered insight on future trends to inform decision-making

Table of Contents

1. Regime Overview
1.1. Regime Overview - Production Sharing Agreements
1.2. Regime Overview - Royalty and Tax Licenses
1.3. Regime Overview - Pemex Assignment Regime
1.4. Timeline
2. State Take Assessment
3. Key Fiscal Terms - Production Sharing Agreement
3.1. Royalties, Bonuses and Fees
3.1.1. Signature Bonus
3.1.2. Royalty
3.1.3. Exploration Rental Fees
3.1.4. Hydrocarbon Activity Tax
3.2. Cost Recovery
3.2.1. Limit on Recovery
3.2.2. Recoverable Costs and Non-Recoverable Costs
3.2.3. Uplift on Cost Recovery
3.3. Profit Sharing
3.4. Direct Taxation
3.4.1. Corporate Income Tax
3.4.2. Deductions and Depreciation
3.4.3. Withholding Tax
3.5. Indirect Taxation
3.5.1. Value Added Tax
3.5.2. Customs Duties
3.5.3. Landowner Compensation
3.5.4. Carbon Tax
3.6. Abandonment Fund
3.7. State Participation
4. Key Fiscal Terms - Royalty and Tax
4.1. Signature Bonus
4.2. Royalty
4.3. Additional Royalty
4.3.1. Deepwater: Profitability-Based Adjustment Mechanism
4.3.2. Onshore: Production-Based Adjustment Mechanism
4.4. Exploration Rental Fees
4.5. Hydrocarbons Activity Tax
4.6. Taxation
4.7. Abandonment Fund
5. Key Fiscal Terms - Pemex Assignment Regime
5.1. Royalties, Bonuses and Fees
5.1.1. Royalty
5.1.2. Exploration Rental Fees
5.1.3. Hydrocarbon Activity Tax
5.2. Profit Sharing Duty
5.3. Taxation
5.3.1. Fiscal Stimulus
6. Regulation and Licensing
6.1. Legal Framework
6.1.1. Governing Law
6.1.2. Contract Type
6.1.3. Title to Hydrocarbons
6.2. Institutional Framework
6.2.1. Licensing Authority
6.2.2. Regulatory Agency
6.2.3. National Oil Company
6.3. Licensing Process
6.3.1. Migration of Assignments
6.3.2. Licensing Rounds
6.3.3. Registration and Prequalification
6.3.4. Bidding
6.3.5. Evaluation of Bids
6.4. License Terms
6.4.1. Duration and Relinquishments
6.4.2. Work Obligation
6.5. Local Content
7. Appendix
7.1. References
8. Appendix
8.1. Contact Us
8.2. Disclaimer
List of Tables
Table 1: Regime Overview
Table 2: Mexico, Key Events Since Year 2000
Table 3: Mexico, Production Sharing Agreement, Formula-Based Price for Crude Oil, Round 1.1
Table 4: Mexico, Production Sharing Agreement, State’s Share of Profit (%), Rounds 1.1, 1.2, 2.1, and 3.1
Table 5: Mexico, Royalty and Tax, Applicable Signature Bonus (US$)
Table 6: Mexico, Royalty and Tax, Additional Royalty Adjustment Mechanism
Table 7: Mexico, Royalty and Tax, Additional Royalty Rates (%), Deepwater Licenses, Rounds 1.4 and 2.4
Table 8: Mexico, Royalty and Tax, Additional Royalty Adjustment Mechanism, Onshore
Table 9: Mexico, Royalty and Tax, Additional Royalty Rates (%), Rounds 1.3, 2.2, and 2.3
Table 10: Mexico, Pemex Assignment Regime, Profit Sharing Duty Rates (%), 2015 onward
Table 11: Mexico, Pemex Assignment Regime, Maximum Deduction for the Calculation of the Profit-Sharing Duty
Table 12: Mexico, Types of Offered Agreements According to the Licensing Round
Table 13: Mexico, Round 2.3, 2.4 and 3.1 Prequalification Requirements
Table 14: Mexico, License Duration (Years)
Table 15: Mexico, Local Content Requirement (%)
Table 16: References
List of Figures
Figure 1: Regime Flow Chart - Production Sharing Agreement
Figure 2: Regime Flow Chart - Royalty and Tax
Figure 3: Regime Flow Chart - Pemex Assignment Regime
Figure 4: Mexico, Indicative NPV10/boe, IRR and State Take Comparison, Regional
Figure 5: Mexico, Legal Framework
Figure 6: Mexico, Institutional Framework

Related Topics

Related Reports

North America Hydraulic Fracturing Market, Competition, Forecast & Opportunities, 2018-2028 - Product Image

North America Hydraulic Fracturing Market, Competition, Forecast & Opportunities, 2018-2028

  • Report
  • 122 Pages
  • North America
From
Hydraulic Fracturing Well Testing Services Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028F - Product Image

Hydraulic Fracturing Well Testing Services Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028F

  • Report
  • 171 Pages
  • Global
From
Decommissioning Forecasting and Operating Cost Estimation. Gulf of Mexico Well Trends, Structure Inventory and Forecast Models - Product Image

Decommissioning Forecasting and Operating Cost Estimation. Gulf of Mexico Well Trends, Structure Inventory and Forecast Models

  • Book
  • Mexico
The Offshore Pipeline Construction Industry. Activity Modeling and Cost Estimation in the U.S Gulf of Mexico - Product Image

The Offshore Pipeline Construction Industry. Activity Modeling and Cost Estimation in the U.S Gulf of Mexico

  • Book
  • Mexico, United States Mexico, United States
Gulf Of Mexico Oil And Gas - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2020 - 2029 - Product Image

Gulf Of Mexico Oil And Gas - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2020 - 2029

  • Report
  • 110 Pages
  • Mexico
From
Copyright © 2002-2024 Research and Markets. All Rights Reserved.