Sunday, June 16, 2024

Pemex chief foresees spurt in production to 1.9 million barrels

Pemex CEO Octavio Romero predicted on Wednesday that the state oil company’s daily production would exceed 1.9 million barrels per day (bpd) by the end of 2020.

“. . .that’s our goal for this year,” he told reporters at the presidential press conference.

If achieved, Pemex’s daily oil production at the end of 2020 would be 14.4% higher than the daily average last year when the state-run company had an output of 1.66 million bpd.

Romero said today that Pemex had managed to put a halt to the declining production that has plagued the company for a decade and a half and predicted that output this month would be 1.74 million barrels.

Even though 2019 production was 46,000 bpd below the target set by Pemex management, the CEO rejected the notion that the company hadn’t met its goal, asserting that it has simply been deferred.

“We had scheduled to put wells in the new fields in December and January [but]. . .the weather conditions didn’t allow it. There were a lot of cold fronts on the coast of Tabasco and Campeche and that caused problems. . .” Romero said.

“What we’re doing is postponing the entry of those wells. It’s not that we didn’t reach the [2019] goal, we deferred it; we’re going to achieve it. Regardless of that, a lot of wells are increasing production,” he added.

Fausto Álvarez, a former senior official at the National Hydrocarbons Commission, the oil sector regulator, said earlier this month that the state oil company would need “a level of productivity and success that. . . [it] has never achieved” in order to reach the production targets it has set itself.

Romero also revealed that Pemex is seeking control over a major offshore oil reserve discovered by a private consortium of companies in 2017. He said the state oil company believes that most of the crude found is in an adjacent block where Pemex has development rights.

“This reservoir is shared,” Romero said, referring to the Zama shallow-water field which contains about 700 million barrels of crude.

The news agency Reuters reported last September that Pemex wanted to take over the Gulf of Mexico project but President López Obrador denied that was the case.

However, Romero said clearly that Pemex “wants to be the operator of this field,” adding that a company analysis showed that “most” of the Zama reservoir was located in Pemex’s block.

The finding differs from that announced by United States oil firm Talos Energy, which said earlier this month that a third-party study showed that 60% of the oil is in the block held by the consortium it leads. Just 40% is in the Pemex block, it said.

Romero, however, suggested that the figures provided by Talos were an “interpretation” rather than fact.

The Texas-based company has been negotiating with Pemex over a joint scheme to develop the field for more than a year but no agreement has been announced.

The fight for control over Zama, Reuters said, could mark a “turning point” for López Obrador, who is seeking a greater role for the state in Mexico’s energy sector.

Since he took office in December 2018, no new oil fields have been auctioned off and the president said this month that there were no plans to hold any auctions.

López Obrador has also put an end to new joint ventures known as farm-outs even though many analysts say the move robs the heavily indebted state oil company of the opportunity to share investment risk with the private sector.

Source: El Financiero (sp), Reuters (en) 

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