Renaissance, in conjunction with its partner, Lukoil, drilled six new wells of the approved 10 Chicontepec well appraisal program for the Amatitlรกn blocks and completed workovers and repair operations on the final well of a six well restoration program wells where it is too comprehensive and too cumbersome for onshore because onshore production requires many more wells. Q: Can you outline the bidding process for the Chiapas blocks you won by very thin margins on additional royalties? A: We have a brilliant technical team and I think we have a very good idea of what the performance of the new wells is going to look like on these Chiapas blocks. We are a small, lean operator. We do not overspend and as result we feel we can make a small profit on these areas. We know we are not going to make a lot of money because we bid fairly high royalties to win them. Back in December 2015 when we won the Chiapas blocks in the licensing round we had another priority, to be an early operator which was initially more important than making a lot of money. We are in Mexico for the long term and there is a whole new regime with new regulations and new laws. There is a very steep learning curve and we knew we needed to become a competent operator with small blocks like the ones we won in Chiapas. We acquired those blocks as our learning ground, knowing that bigger deals were yet to come. Our goal was to be an efficient operator in Mexico before we took on the big deals. These acquisitions led to the deal with Lukoil. The Amatitlรกn field in our view is in the sweet spot of the unconventional play in the TampicoMisantla basin. It was always high on our list of priorities. Lukoil was looking for three characteristics in a partner; it needed a Mexico-focused operator, it needed somebody with unconventionals expertise and it needed a company that is a lean operator and that can make decisions quickly. We tick those boxes, but it all started with Chiapas. We are looking for deal flow and expect to expand our operations significantly. Our goal is to be the dominant onshore operator in Mexico aside from PEMEX over the next five years.
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