Talos Energy will drill two additional wells aimed at determining the size of an oil discovery in the Gulf of Mexico (GoM) that could extend into a neighboring block held by Mexican state oil firm Pemex, oil regulator CNH said on Sept. 25.

Talos will drill the first so-called delimiting well later this year and the other one in 2019, according to a plan approved by the National Hydrocarbons Commision (CNH). A delimiting well serves to identify the size, limits and scope of a discovery.

Pemex reached a preliminary agreement with the Talos consortium, which includes Britain’s Premier Oil and Mexico’s Sierra Oil & Gas, on Sept. 20 to evaluate whether the group’s find extends into a neighboring Pemex block.

The consortium won development rights for two blocks in the shallow waters of the GoM off the coast of southern Tabasco state during the first oil auction launched by President Enrique Pena Nieto. Held in 2015, the auction marked the end of Pemex’s decades-long monopoly.

Last year, the consortium said its Zama-1 well drilled in the Area 7 shallow water block confirmed the discovery of a deposit that could hold between 1.2 billion barrels (Bbbl) to 1.8 Bbbl of crude oil.

The new wells, named Zama-2 and Zama-3, will be drilled in line with Zama-1, on the border with Pemex’s block, according to CNH.

Offshore