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Mexico President Enrique Pena Nieto flanked by Pemex's Emilio Lozoya (right) and Lukoil's CEO Vagit Alekperov

Mexico’s state-owned Petroleos Mexicanos (Pemex) and Russia’s Lukoil signed an agreement in Davos late last month to work jointly on exploration and production.

Pemex chief Emilio Lozoya and Lukoil’s CEO Vagit Alekperov said the E&P agreement will help Pemex “bolster its operating and technological capacity.”

Mexico enacted reforms late last year to allow foreign investment and private ownership in the oil and gas sector for the first time in 75 years.

Lukoil is Russia’s second biggest producer after Rosneft.

President Enrique Pena Nieto, who was present for the Pemex – Lukoil signing, proposed the reforms to revive flagging production.

Mexico’s crude output fell to less than 2.5 million barrels per day from a high in 2004 of 3.4 million barrels per day.

The drop is blamed on field maturation.

Since 1938, Pemex has held a monopoly over the oil and gas industry and foreign capital was banned.

Lukoil may be assisting with enhancement of mature fields and deep-water areas, according to press reports, as well as the development of shale-gas reserves.

The Lukoil – Pemex cooperation agreement is Mexico’s first international oil and gas deal since the reforms.