Mexico’s energy reform could take a bite out of US shale-gas sellers, EIA chief says

HOUSTON – A top U.S. energy official said Thursday he’d like to get together with Mexican authorities and pore over natural gas production forecasts to understand how much Mexico’s energy reform may set back U.S. shale-gas sellers.

Mexico’s sweeping policy changes are expected to boost the country’s oil and gas output by drawing contract bids from international oil companies and forming joint ventures between the state-run Pemex and private firms.

“The U.S. is a pretty large exporter of natural gas to Mexico right now,” said Adam Sieminski, administrator of the Energy Information Administration, during the ninth annual Mayer Brown Global Energy Conference in Houston. “If shale gas, conventional gas or deep-water gas were developed in Mexico, then that would alter our forecast for how much shale gas the U.S. would be selling to Mexico.”

Sieminski said he’d be curious to see how much gas Mexico expects to extract through 2025. It’s almost impossible to know how viable the nation’s unconventional energy resources are until more development takes place, he said. But natural gas, he said, seems to be more prominent in the region than oil.

“I think the reform down there could lead to opportunities for Mexico to develop its own gas resources, maybe even joining the U.S. in becoming an exporter, which would be another remarkable event,” he said.