World Bank Group member International Finance Corporation (IFC) and private equity firm China-Mexico Fund have agreed to invest $200m in Mexican oil company Citla Energy.
IFC said that the investment decision comes as a result of ‘attractive economic conditions’ prompted by the reforms implemented in 2013. The reform intends to promote private sector participation in the Mexican oil industry.
Citla CEO Alberto Galvis said: "This investment reinforces Citla’s position as an independent and institutional platform with resources to access carefully selected opportunities of the Mexican Energy Reform."
IFC plans to invest $60m in the Mexican independent oil exploration and production while the remaining $140 will be invested by China-Mexico Fund, a $1.2bn private equity fund managed by the IFC Asset Management Company.
Citl, which is controlled by affiliates of US investment firm ACON Investments, has portfolio of exploration and production assets in Mexico, both independently and in partnership with other industry participants.
ACON managing partner Jorge Dickens said that the experience of IFC and AMC would complement ACON.
Dickens added: "This partnership will help make Citla a regional industry leader that will operate under the highest international standards."
Citla seeks to expand its oil exploration and production in Mexico through biding awards, acquisitions, farm-ins and partnerships with other operators.
IFC México country manager Ary Naïm said: "As Mexico opens its oil and gas sector to private competition, IFC’s goal is to support new players that combine strong sector expertise, local and global know-how, and adequate capitalization, and Citla Energy reflects all them.
"With this investment, IFC, AMC, Citla Energy and ACON send a strong signal of confidence in the Mexican Energy Reform agenda."
Image: International Finance Corporation headquarters in Washington, D.C. Photo: courtesy of AgnosticPreachersKid/Wikipedia.