Major oil discovery heralded offshore Mexico

July 12 (UPI) -- An energy company working off the eastern coast of Mexico said Wednesday it made a discovery that could hold as much as 2 billion barrels of oil.

Talos Energy, working alongside joint venture partners Sierra Oil and Gas and Premier Oil, said it confirmed a discovery at the Zama-1 exploration well off the coast of Mexico. Initial estimates put the reserve potential at between 1.4 billion and 2 billion barrels of oil, which exceeded early expectations.

"This is both a historic and significant discovery," Talos President and CEO Tim Duncan said in a statement.

Sierra Oil and Gas, a Mexican company, is the majority stakeholder in the partnership.

The discovery follows similar claims made by Italian energy company Eni in March, which confirmed the potential for oil offshore Mexico in the first drilling campaign by a foreign company since 2013.

Eni said it confirmed the presence of oil in the Amoca-2 well, located in the shallow waters in the Campeche Bay near Mexico's southern tip. The company said the reserve potential from the Amoca-2 well was still being examined, but it estimated the prospects were high.

Mexican President Enrique Peña Nieto moved through reforms to draw private investors to the state energy sector after more than 70 years of a monopoly controlled by state-run Petroleos Mexicanos, or Pemex. The reforms could bring in up to $415 billion in investments over the next 20 years as the country establishes links to the rest of the world.

Mexico aims to produce around 3.5 million barrels per day by 2025.

"We believe this discovery represents exactly what the energy reforms intended to deliver: new capital, new participants and a spirit of ingenuity that leads to local jobs and government revenues for Mexico," Duncan said.

Drilling at the basin about 37 miles off the Mexican shore began in May and including personnel from both Mexico and the United States.