Eni allowed to drill exploration well in Mexico's ultra-deepwater Cuenca Salina Basin

Italian operator Eni will drill an exploration well in the ultra-deepwater Cuenca Salina Basin off Veracruz in the Gulf of Mexico to obtain data that will help determine whether to develop the area.

During its weekly meeting, Mexico's National Hydrocarbons Commission, or CNH, on April 18 approved the request presented by Eni to drill Tlazotli 1, the first exploration well in the block operated under contract CNH-R02-L04-AP-CS-G05/2018.

The area where Tlazotli is located looks "promising," CNH technical advisers said during the meeting. as other companies have already struck oil nearby.

Pemex has drilled two wells roughly 36 and 38 kilometers (22.4 to 23.6 miles) away, respectively, the commission said.

At the block, Eni has identified seven prospects with various levels of resources. At Tlazotli, the largest of the prospects, Eni hopes to find roughly 470 million boe in a Miocene formation, mostly light crude, the commission said.

Eni will drill Tlazotli from May 28 to July 16, spending roughly $54 million, the commission said.

Eni has been one of the most successful drillers in Mexico since the country liberalized upstream operations in late 2013. The company recently announced a discovery in one of its operating areas, known as Block 7, where Eni has located roughly 200 million barrels of oil equivalent.

Eni holds eight upstream contracts in Mexico and is an operator in seven of them. In February, Eni produced 26,440 b/d of crude and 22 MMcf/d of gas, CNH data shows.

Eni CEO Claudio Descalzi told investors during a meeting in February that the company is investing roughly $2.1 billion through 2026 in exploration activities around the world, hoping to find 2.2 billion boe, mostly gas, as the company tries to reduce methane emissions and slowly trim its exposure to oil and focus on gas as a transition fuel.

Mexico is the only pure oil play in the company´s portfolio.