Weatherford, Halliburton, Schlumberger Eye Mexico Gas Project

Oil-services giants Weatherford International Ltd. (WFT), Halliburton Co. (HAL) and Schlumberger Ltd. (SLB) have submitted proposals for a natural-gas drilling contract in Mexico's Burgos basin, said state-run Petroleos Mexicanos on Wednesday.

Two Mexican companies, Industrial Perforadoa de Campeche and CCC Fabricantes y Construcciones, also submitted proposals. Pemex, as the state-run oil company is known, is looking to boost natural-gas output at Burgos, which pumped 22% of Mexico's gas in May.

The three-year contract is scheduled to start in mid-August, according to documents on Compranet, the government procurement Web site.

Mexico is increasing oil investments this year, even though prices have fallen compared with 2008, providing opportunities to major oil-service 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. The company expects to increase capital expenditures by about 10% this year to $20 billion.

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