Country report
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19 Pages

Mexico upstream fiscal summary

Mexico upstream fiscal summary

Report summary

In 2015, Mexico redirected licensing from Integrated Service Contracts (CIEPs) in favour of Petroleum Sharing Agreements and Concession-style Licenses to attract international investment.  These contracts are awarded in highly transparent licence rounds.
Shelf blocks are regulated under Petroleum Sharing Agreements in a very progressive fiscal system, consisting of price-driven royalties, a biddable profit share based varying with IRR, and income tax.
Onshore and deepwater blocks are regulated under a concession-style License system, with royalties based on production, price, R-Factor and/or bid level in addition to the income tax.

What's included?

This report includes 1 file(s)

  • Mexico upstream fiscal summary PDF - 454.14 KB 19 Pages, 23 Tables, 17 Figures


Volatility in oil markets has led players in the upstream oil and gas industry to focus on reducing capital spend and operating costs. At the same time, governments need to review fiscal terms to maintain attractiveness and investment.

This country report gives an overview of the key fiscal issues for this country. If you’re interested in identifying and assessing upstream investment and expansion opportunities, this upstream fiscal summary report is your definitive commercial guide.

Potential investors, governments and companies in the oil and gas sector can use it to gain a better understanding of the critical issues for development opportunities in this country.

Wood Mackenzie's 500 dedicated analysts are located in the markets they cover. They produce forward-looking analysis at both country and asset level across the globe, backed by our robust proprietary database of trusted research. Proprietary data means a superior level of analysis that is simply not available anywhere else. Wood Mackenzie is the recognised gold standard in commercial data and analysis.

  • Executive summary
  • Current licence, equity and fiscal terms
    • Basis
    • Licence terms
    • Fiscal terms
      • Ring fencing
      • Government equity participation
      • Bonuses, rentals and fees
      • Indirect taxes
      • Royalty
      • Cost oil - PSC only
      • Profit oil - PSC only
      • Corporate income tax
      • Fiscal treatment of decommissioning
      • Product pricing
      • Summary of modelled terms
        • Assumed terms by location - shelf
        • Assumed terms by location - deepwater
  • Fiscal stability
    • Recent history of fiscal changes
      • Timeline detail
    • Stability Provisions
  • Economic analysis
    • Split of the barrel and share of profit
    • Effective royalty rate and maximum government share
      • Maximum government share – shelf, gas
      • Maximum government share – deepwater, oil
      • Maximum government share – deepwater, gas
    • Progressivity
    • Fiscal deterrence

In this report there are 40 tables or charts, including:

  • Executive summary
    • PSC Flowchart
    • License Flowchart
  • Current licence, equity and fiscal terms
    • Bonuses, rentals and fees
    • Indirect taxes
    • Royalty rates
    • Price-based royalty
    • Liquids Royalty (%) by Price
    • Gas Royalty (%) by Price
    • Production - based royalty, liquid
    • Current licence, equity and fiscal terms: Table 6
    • Liquids Combined Royalty (%) by Production
    • Gas Combined Royalty (%) by Production
    • R-factor royalty
    • Additional royalties
    • Profit sharing
    • Assumed terms by location - onshore
    • Current licence, equity and fiscal terms: Table 9
    • Current licence, equity and fiscal terms: Table 10
  • Fiscal stability
    • Timeline
    • Fiscal stability: Table 1
  • Economic analysis
    • Split of the barrel - oil
    • Split of the barrel - gas
    • Share of profit - oil
    • Share of profit - gas
    • Effective royalty rate - onshore, oil
    • Effective royalty rate - onshore, gas
    • Effective royalty rate - shelf, oil
    • Effective royalty rate - shelf, gas
    • Effective royalty rate - deepwater, oil
    • Effective royalty rate - deepwater, gas
    • Maximum government share – onshore, oil
    • Economic analysis: Table 8
    • Economic analysis: Table 9
    • Economic analysis: Table 10
    • Economic analysis: Table 11
    • Economic analysis: Table 12
    • State share versus Pre-Share IRR - oil
    • State share versus Pre-Share IRR - gas
    • Investor IRR versus Pre-Share IRR - oil
    • Investor IRR versus Pre-Share IRR - gas
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