Mexican state-run oil company Pemex and America’s Talos Energy Inc have been ordered by the energy ministry to find a resolution over how they will jointly develop the large Zama offshore oil discovery, according to Reuters.
This announcement comes after it was decided that Talos’s discovery, situated in the company’s Gulf of Mexico block, overlaps into Pemex’s neighboring block.
The parties must now determine how the operational tasks will be decided. The energy ministry declared that the two companies have 120 working days to arrive at an agreement to jointly develop the Zama reservoir. Failing to reach an agreement, the energy ministry has the power to decide which firm will run Zama.
Zama was discovered in December 2017 and is believed to contain nearly 700 million barrels of oil (mmbbl), making it the biggest new find in Mexico by a private company in decades.
Both companies have claimed the majority of the oil discovery falls on their side respectively. Pemex has yet to begin drilling operations, whereas Talos has already drilled four exploration wells.