TBY talks to Hermes Aguirre, Country VP Mexico for Halliburton, on the firm’s global strategy, the future of the country’s oil industry, and local talent.
How important is Mexico within the company’s international business strategy?
Halliburton has had a strong presence in Mexico for over 70 years. The company expanded its presence in Mexico through its business lines and technology offerings for onshore and offshore projects. Offshore projects currently account for 80% of the country’s production which translates to a high demand for Halliburton’s products and services. Moreover, exploration is another key activity in the country and we work closely with operators to locate new reserves and produce them economically. Remarkably, Halliburton has participated in all the inland exploration and development programs with a major operator to help the company drive greater returns and maximize their asset value.
How are you helping companies reduce their cost per barrel?
From the drilling side, we deliver the latest technologies to the rig site which helped reduce the number of days by 30-40%. Our expertise allows Halliburton to reduce costs and drilling time in onshore and offshore projects. One example is providing new stimulation vessels to Mexico that will help operators produce wells earlier to save valuable time. Additionally, our services help new companies entering the country accelerate their investment and start-up projects, particularly for exploration wells.
What is your opinion of the change of Director General at Pemex and how are you adapting?
Halliburton has worked around the globe with different national oil companies, so we understand the responsibility and changes that those companies go through when there is a governmental transition. We will continue to work with the new administration as we have with previous administrations and maintain strong relationships from the top management to the workers in the field. Halliburton will continue to align our business with our customers’ challenges and collaborate to deliver the right solutions.
How was the company able to return to profitability in 2017 before all other service companies?
The improving prices in combination with our higher levels of efficiency allowed us to grow positively. The industry suffered from the impact of low pricing and we worked hard to reduce costs to soften the blow. We developed several global continuous improvement initiatives to increase efficiency and drive cost savings in our daily business. We also brought new ideas and technologies to customers that helped them optimize previously drilled wells and boost production in existing assets. The last four years have been challenging; however, they have given us the opportunity to review our execution and how we work with customers. These initiatives throughout the organization were responsible for limiting expenses, recalibrating our focus on efficiency and demonstrating our commitment to operators and their particular challenges.
What is your outlook for exploration demand in the coming years in the Mexican oil industry?
Halliburton views the Mexican market favorably and sees a tremendous commitment from the international oil companies (IOC’s) and other operators across the E&P landscape. Big players such as integrated majors are continuously investing in the country and starting their exploration projects. One of the significant challenges in the region is reservoir recovery which is driving greater investment into exploration to increase declining reserves. We are aware that these projects will play a key role in operations for the next four to five years. Moreover, these projects will demand high levels of technology and we are prepared to offer these services.
How do you strive to keep expanding Halliburton’s presence in Mexico in the coming years?
We are well established in Mexico and plan to expand by further understanding the unique challenges of the country and opportunities they provide for service companies. The company plans to reactivate its presence in deep-water projects and onshore expansion in northern Mexico. We also see opportunities in helping the country expand its gas production as there are many important reserves to participate in. We have a large portfolio of service providers and national companies that collaborate with us to make sure that new projects continue to be developed. In terms of employment, we incorporate local talent in the company and almost 97% of our staff are Mexican. Halliburton will continue to support the local economy and have a large number of Mexican professionals working internationally. It is important for the talent to grow not only in Mexico, but outside the country as well.