Carlos Slim's Grupo Carso Invests $1.2 Billion in Lakach Gas Field

Carlos Slim's Grupo Carso to Invest $1.2 Billion in Mexico's Lakach Gas Field

Carlos Slim's investment powerhouse, Grupo Carso, has committed $1.2 billion for the development of the Lakach gas field in the Gulf of Mexico, targeting production by 2026. This move is strategically significant, involving a partnership with Pemex, Mexico's state oil company, aligning with the government's heightened control over the energy sector. The collaboration also extends to included cooperation with Talos Energy and Fomento de Construcciones y Contratas SA, further amplifying Slim's influence in the energy domain. Despite Grupo Carso experiencing a 33% decline in shares year-to-date, this venture holds promise to instill long-term confidence in the minds of investors.

The Lakach field, discovered in 2007, sits 98 kilometers southeast of Veracruz. Grupo Carso will construct an onshore facility for gas and condensate storage and processing while Pemex retains ownership. This marks a strategic diversification move for Slim, known for his telecommunications giant, America Movil, as he ventures further into the energy sector. The investment perfectly aligns with his vision to harness Mexico's energy potential, particularly in light of trade tensions between China and the US, where he has stressed the necessity for energy investments to attract further economic prosperity.

Key Takeaways

• Grupo Carso is set to invest $1.2 billion in the Lakach gas field, with a production target of 2026.
• The collaboration with Talos Energy and Fomento de Construcciones y Contratas SA bolsters Slim's influence in the energy sector.
• Despite a 33% year-to-date decline in Carso shares, the Lakach investment carries the potential to bolster long-term investor confidence.
• Slim's companies already hold permits for geothermal energy production, contingent on government approval.
• President Lopez Obrador's positive remarks about Slim's commitment to investing in Mexico indicate potential backing for future projects.

Analysis

Carlos Slim's substantial investment of $1.2 billion in the Lakach gas field, in conjunction with Pemex and other partners, reflects a strategic move to capitalize on Mexico's energy potential. Despite the decline in Carso shares, this venture holds the potential to stabilize investor confidence and amplify Slim's influence within the energy sector. The collaboration perfectly aligns with the government's energy control strategy, potentially securing broader political support for future initiatives. Short-term implications encompass job creation and economic stimulation, while the long-term advantages could encompass growth in the energy sector and heightened foreign investment, mitigating trade tensions.

Did You Know?

• Lakach Gas Field:
  • Discovered in 2007, the Lakach gas field is an invaluable offshore reserve situated in the Gulf of Mexico, approximately 98 kilometers southeast of Veracruz, Mexico. Its development involves intricate offshore drilling and necessitates substantial infrastructure, including an onshore facility for the processing and storage of gas and condensate.
• Pemex (Petróleos Mexicanos):
  • The state-owned petroleum company of Mexico holds a pivotal role in the country's energy sector. Under the current government's stance of reinforcing state authority over the energy industry, Pemex has been central to energy projects and partnerships, signifying a strategic fusion of state resources and private investments for national energy endeavors.
• Talos Energy and Fomento de Construcciones y Contratas SA (FCC):
  • Talos Energy is an independent oil and gas firm primarily focused on the exploration and production of oil and natural gas in the Gulf of Mexico and Gulf Coast region, showcasing its proficiency in offshore energy development through the collaboration with Grupo Carso in the Lakach project.
  • Fomento de Construcciones y Contratas SA (FCC) is a Spanish multinational enterprise specializing in infrastructure, construction, and services. Its partnership with Grupo Carso in the Lakach project highlights its contributions toward engineering solutions for the establishment of the required onshore facility for gas processing and storage.