On 7 May 2018, Shell operator with 100% working interest was granted official awards for four blocks from the CNH-RO2-LO4/2017 Bid Round including the CNH-RO2-LO4-AP-CS-G01/2018 contract, CNH-RO2-LO4-AP-CS-G02/2018 contract, CNH-RO2-LO4-AP-CS-G04/2018 contract, and the CNH-RO2-LO4-AP-CM-G09/2018 contract. Â   On 31 January 2018, Shell operator with 100% working interest was granted preliminary awards for four blocks from the CNH-RO2-LO4/2017 Bid Round including the 2,079.50 sq km Area 20, AP-CS-G01, the 2,029.74 sq km Area 21, AP-CS-G02, 1,852.86 sq km Area 23, AP-CS-G04, and the 3,066.83 sq km Area 28, AP-CM-G09 block.Â  The final official contract signature award is to take place within 90 days or 1 May 2018.      For      the Area 20 block, the company bid 20% of additional royalties over the      minimum of 5%, 2.0 work units factor equivalent to two wells, and a      tie-break bonus of USD 90.15 million. Â There was one other bid for the block by      PEMEX who bid 6.11% additional royalties and no additional work units      factor.    For      the Area 21 block, the company bid 20% of additional royalties over the      minimum of 5%, 2.0 work units factor equivalent to two wells, and a      tie-break bonus of USD 110.15 million representing the second highest      tie-break bonus in the round.Â  There      were four other bids for the block.Â       The second place bid was made by the consortium of Chevron, PEMEX,      and ONGC who bid the maximum additional royalties and additional work      units factor but lost the tie-break bonus offering USD 42.1 million.    For      the Area 23 block, the company bid 10.08% of additional royalties over the      minimum of 5%, 1.0 work units factor equivalent to one well. Â There was one other bid for the block by      the consortium of Chevron, PEMEX, and Inpex who bid 13.44% additional      royalties but no additional work units factor.    For      the Area 28 block, the company bid 20% of additional royalties over the      minimum of 5%, 2.0 work units factor equivalent to two wells, and a      tie-break bonus of USD 43.15 million. Â There was one other bid for the block by      PC Carigali who bid 19.88% additional royalties and no additional work      units factor.     The general license contract terms include the following:      The      exploration phase consists of an initial four (4) year period with two      three (3) year extension periods possible for a total of 10 years.Â  Each extension period is contingent on      the company committing to additional work commitments that includes one or      two wells.     There      is a three (3) year evaluation period following the exploration phase.     There      is a development and production phase which can be from 22 to 28 years for      a total contract term of 35 years.Â       There is the possibility of two extensions to this phase of 10 to      five (5) years for a total contract term of 50 years.     The      local content requirements are 3% in the exploration and evaluation phase,      4% in the development phase, and 10% in the production phase.     Rights      to the entire geological column.     The      basic royalty is a variable formula depending on hydrocarbon type and      price but starts at approximately 5% in addition to the additional      royalties bid for the contract.     There      is a rental rate of MXN 1,214/sq km for the first 60 months and then the      rate increases to MXN 2,904/sq km thereafter.     There      is an exploration and production tax of MXN 1,584/sq km during the      exploration phase which increases to MXN 6,335/sq km during the production      phase.     The      corporate income tax is 30%.     There      is also a profitability adjustment factor that can be modify the royalty      rate and the contractorâs profitability is to be measured quarterly and calculated      prior to corporate income tax and the exploration and production tax.
Mexico, Area 23