China – Mexico fund to pump $200 million USD into Mexico oil industry

Sonda de campeche oil well in the Gulf of Mexico (Photo: CNN)

The International Finance Corporation (IFC), the World Bank’s private-sector investment arm, and the private equity firm China-Mexico Fund recently announced a $200 million USD investment in Citla Energy, a new Mexican oil company.

The IFC said the investment was prompted by the “attractive economic conditions” in Mexico’s energy sector, following a sweeping overhaul in 2013 that ended the nearly 80-year-old monopoly of state-owned oil giant Pemex.

The IFC said it would commit $60 million to Citla, and channel the rest from the China-Mexico Fund, a $1.2 billion private equity fund managed by the IFC Asset Management Company.

The World Bank unit had some $1.4 billion invested in Mexico as of July 2015, its seventh-biggest investment in the world.

Citla Energy is a Mexican independent exploration and production company. With offices in Mexico City and Houston, Citla is an active participant in the opening of the Mexico oil & gas sector, where it seeks to acquire and build a portfolio of selected onshore and offshore assets, both independently and in partnership with other industry participants.

Citla was founded last year by ACON Investments, a U.S. investment firm that manages private funds that invest in the United States and Latin America, according to Citla’s website.

Citla plans to expand its oil exploration and production in Mexico through awards of bids, acquisitions, and partnerships with other operators, the IFC said in a statement.

Oil drilling activity in Campeche has declined with the drop in oil prices.(PHOTO:
Oil drilling activity in Campeche has declined with the drop in oil prices.(PHOTO:

(Reporting by Adriana Barrera; Writing by Anna Yukhananov; Editing by Jonathan Oatis)

Written by: Reuters