mexico's largest oil field to die by 12/10- consequences?

[GRG55]

Re: mexico's largest oil field to die by 12/10- consequences?

Clarion Call from Cantarell

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i ended the title with "consequences?" how about no oil revenues for the mexican state? some domestic problems south of the border? spillover? just askin'.

One of the consequences is that the Mexican state oil company, Pemex, is now coming under much more scrutiny regarding performance than perhaps any previous time in its history...

Mexican gov't orders state oil firm to suspend onshore exploration
2009-10-09 14:13:49

MEXICO CITY, Oct. 8 (Xinhua) -- The Mexican government on Thursday ordered state-run oil giant Petroleos Mexicanos (Pemex) to halt its exploration in the Chicontepec oil field, but left the final decision to the company.

Pemex said the new Chicontepec onshore field was expected to compensate for the declining production of Cantarell, which had provided the bulk of Mexico's oil for three decades.

"The project should be halted until Pemex has a proper development plan," Juan Carlos Zepeda, president of the National Hydrocarbons Commission, said at a public event in the central Mexican city Leon.

He added that the commission would renegotiate the halting issue with the company by the end of the year.

The National Hydrocarbons Commission, created as part of an overhaul of Mexico's energy laws, sets technical standards for the country's crude oil and natural gas fields.

But Pemex said that the project was too important to be abandoned because of the previous large investment.

In order to halt the project and plan a proper one, at least eight contracts, worth a total of 2 billion dollars, should be reviewed.

[GRG55]

Re: mexico's largest oil field to die by 12/10- consequences?

One of the consequences is that the Mexican state oil company, Pemex, is now coming under much more scrutiny regarding performance than perhaps any previous time in its history...

That they don't already have a sound depletion plan mapped out for their single largest asset says a lot, and not much of it favourable.

Neither CO2 injection nor steam injection in heavy oil is a leading edge technology, so the fact that Pemex doesn't appear to have done the normal technical work to assess these years ago is truly surprising...

Pemex aspires for 60% oil recovery from Cantarell

NEW ORLEANS
Petroleumworld.com, Oct 08, 2009

Pemex Exporation & Production is studying new ways for recovering more oil from the tight reservoir matrix of the Cantarell field off Mexico.

Speaking Oct. 7 at the SPE Annual Conference & Exhibition in New Orleans, Carlos Morales Gil, Pemex E&P director general, said carbon dioxide injection might provide the means to produce additional oil from the field that originally contained about 35 billion bbl of oil in place, making it the third largest oil field in the world. Steam injection is another possibility for improving recovery of the field's 22° gravity oil, he said.

Gil said Pemex now targets a 60% oil recovery from the field. To date, Pemex has produced about 12.2 billion bbl and has obtained a 41% recovery for the Akal portion of the field, he noted...

[Quincy K]

Re: mexico's largest oil field to die by 12/10- consequences?

[/indent][/indent]That they don't already have a sound depletion plan mapped out for their single largest asset says a lot, and not much of it favourable.

Neither CO2 injection nor steam injection in heavy oil is a leading edge technology, so the fact that Pemex doesn't appear to have done the normal technical work to assess these years ago is truly surprising...

Pemex aspires for 60% oil recovery from Cantarell

NEW ORLEANS
Petroleumworld.com, Oct 08, 2009

Pemex Exporation & Production is studying new ways for recovering more oil from the tight reservoir matrix of the Cantarell field off Mexico.

Speaking Oct. 7 at the SPE Annual Conference & Exhibition in New Orleans, Carlos Morales Gil, Pemex E&P director general, said carbon dioxide injection might provide the means to produce additional oil from the field that originally contained about 35 billion bbl of oil in place, making it the third largest oil field in the world. Steam injection is another possibility for improving recovery of the field's 22° gravity oil, he said.

Gil said Pemex now targets a 60% oil recovery from the field. To date, Pemex has produced about 12.2 billion bbl and has obtained a 41% recovery for the Akal portion of the field, he noted...

I know very little about the currency and foreign bond markets but I did notice last year around October that when the Cantarell's problems started going mainstream is about the same time the peso collapsed against the dollar.

I really don't think that the violence, drug wars or recession has anything to do with their currency problems as much as the possible demise of the Cantarell.

As I am pretty much an astute observer of the Mexican culture, most people here pretty much don't do anything until something needs to be done.

Foresight and planning is typically a day-to-day type of thing in Mexico.

[metalman]

Re: mexico's largest oil field to die by 12/10- consequences?

Foresight and planning is typically a day-to-day type of thing in Mexico.

you win today's yogi berra award.

[Shakespear]

Re: mexico's largest oil field to die by 12/10- consequences?

I am not sure what these "more than 3 billion barrels" represent, Recoverable, Original Oil in Place, etc..

It is good to remember however that whatever oil we find in the ground we only recover to surface 30-40 % of that number that is below ground !!! Physics will not allow more.:eek:

[Starving Steve]

Re: mexico's largest oil field to die by 12/10- consequences?

I know very little about the currency and foreign bond markets but I did notice last year around October that when the Cantarell's problems started going mainstream is about the same time the peso collapsed against the dollar.

I really don't think that the violence, drug wars or recession has anything to do with their currency problems as much as the possible demise of the Cantarell.

As I am pretty much an astute observer of the Mexican culture, most people here pretty much don't do anything until something needs to be done.

Foresight and planning is typically a day-to-day type of thing in Mexico.

A few comments here:

1.) Everything is following Peak Oil Theory. Cantrell is like a squeezed-up old toothpaste tube: to get more toothpaste, more effort is required until the tube is so thin that it is useless to continue on, and the tube is thrown-away;

2.) Chevron is now squeezing the Bakersfield, California (Kern Desert) oil field. The field is now 110 years old, but some light-sweet oil is still left provided that great expense is made to recover the oil; again, this is just like Cantrell and the other old fields worldwide--- all following the path predicted by the Peak Oil Theory;

3.) As the toothpaste tube gets thinner, oil goes up in price. Higher prices make the heavy oil and tar in old oil fields recoverable. Similarly, Alberta's tar sands projects become economically viable with higher oil prices;

4.) Heavy oil in Alberta recovered from tar sand projects will last about 200 years, but the price of oil has to be right. Cantrell in Mexico could last 200 years, but the price has to be right. (Kachinga!)

[GRG55]

Re: mexico's largest oil field to die by 12/10- consequences?

Hope springs eternal...Pemex is still at it. Let's see if they make the target this year. They don't sound too enthusiastic in this article...:rolleyes:

Pemex Oil Output May Rise After 7 Years of Decline

Jan. 5 (Bloomberg) -- Petroleos Mexicanos, the state-owned oil company, may produce more crude in 2011 as new discoveries come on line, arresting seven years of plunging output.

Pemex, as the Mexico City-based company is known, may produce 2.55 million barrels a day next year, up 50,000 barrels from the forecast for 2010, Carlos Morales, head of exploration and production, said in a presentation on the company’s Web site dated Dec. 1 and released at year-end.

Oil production may rise to 2.69 million barrels a day in 2012, Morales said in the presentation. Pemex pumped 2.602 million barrels a day through November 2009.

Pemex’s output entered its seventh year of declines this month, as the company aims to find new deposits and bring discoveries online to replace aging fields. Pemex Chief Executive Officer Juan Jose Suarez Coppel has said the company may pump 2.5 million barrels of oil a day in 2010...

...The production declines cost Pemex about 300 billion pesos ($23.4 billion) in lost sales last year. This forced Mexico’s government, which relies on oil revenue to fund about a third of its budget, to raise taxes to narrow the widest budget deficit in about 20 years...

[bcassill]

Re: mexico's largest oil field to die by 12/10- consequences?

Bring the troops home, boys. It's time to invade Mexico! Yet again! Mexico is a failed narco state. I just wish we had gotten on the Alt Energy bandwagon back in the 1970's: there hasn't been the discovery of a "major" oil field for over 30 years. We can't drive on natural gas and peak oil is coming. Make no mistake about it. The decline in Mexico's fields follows the familiar bell shaped function seen in other fields that have gone into decline. In fact, the majority of large fields have peaked or are in decline worldwide. Wonder why the Saudi's won't divulge their know reserves? Any ideas?

No amount of technology or ingenuity is going to pump out oil that is no longer there.

Watch "Collapse" with Michael Ruppert. Lots of good insight into what to expect in the near future.:eek: