Pacific Rubiales Energy Corp. has entered an agreement in principle with Alfa S.A.B. de C.V. (ALFA) to form a joint venture (JV) company in Mexico on a 50/50 basis, according to a news release.

The JV will also allow for the joint study of, and bidding on, assets in Mexico's initial oil and gas bid round in 2015, the acquisition of services contracts with a view to migrate them to E&P contracts, the development of petroleum and natural gas assets in Mexico and the development of any business ancillary to the petroleum business in Mexico, including midstream projects, the release said.

Under the terms of the agreement, Pacific Rubiales and ALFA will jointly identify, discuss, evaluate and undertake the JV prior to the first bid round. The JV remains subject to any applicable regulatory approvals and the determination of the JV structure pursuant to a definitive agreement, the release said.