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5 Stocks to Profit From Mexico’s Oily Bonanza

XOM leads a pack of 5 companies set to benefit from the new opportunity

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Repsol, S.A.

repsol 185After a bad run in Argentina, Spanish energy firm Repsol (REPYY) is looking for other deals in North and Latin America to fuel its production. While the firm is planning on tackling U.S. shale via an acquisition, Mexico could be a prime destination for the firm.

That’s because PEMEX has been a major shareholder in the oil group since it was privatized in the late 1980s. Currently, PEMEX owns about 9% of the outstanding shares.

Already, Repsol has a few projects in the U.S. portion of the Gulf, so extending downward into Mexican waters is an easy bet. More importantly, the two companies have already intended to collaborate on upstream and liquefied natural gas projects in the Americas, and downstream activities in the Americas, Spain and Portugal. REPYY has also indicated that it has interest in Mexican oil fields onshore.

Naturally, using Repsol’s resources and drilling technology makes a lot of sense for PEMEX, given that it owns a hefty amount of shares. I expect the relationship to grow stronger as the new drilling rules take hold. Investors in the beaten down Spanish firm could be handsomely rewarded.

Article printed from InvestorPlace Media,

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