Mexico's IPC Wins $588 Million Pemex Contract, Beats Foreign Rivals

Mexican driller Industrial Perforadoa de Campeche, or IPC, won a three-year natural-gas drilling contract from state oil company Petroleos Mexicanos worth 7.61 billion pesos ($588 million), according to documents on the Compranet government procurement Web site.

IPC beat foreign rivals Halliburton Co. (HAL) and Schlumberger Ltd. (SLB), which also placed bids to drill wells in the Burgos basin in northern Mexico. Burgos is the largest producer of nonassociated natural gas in Mexico, and accounts for about a fifth of total production.

IPC has 25 land rigs that can drill up to 25,000 feet, according to the company's Web site.

Mexico is increasing oil investments this year even though prices have fallen compared with 2008, providing opportunities for major oil-services firms at a time when most oil companies are slashing budgets to adjust to lower prices.

Mexico is spending heavily to reverse a decline in oil production and expand natural-gas output. Petroleos Mexicanos, or Pemex, expects to increase capital expenditures by about 10% this year to $20 billion.

-By Peter Millard, Dow Jones Newswires; 5255-5001-5724; [e-mail]