Pemex says new crude finds hold 180mn bl: Update
Pemex's two new crude discoveries in shallow waters in the southeast basin of the Gulf of Mexico hold 180mn bl of oil equivalent in possible reserves, the Mexican state-owned company said today.
The Manik 101A and Mulach 1 discoveries are "a good platform to reverse declining production ... and will start production by the third quarter of 2020," Pemex chief executive Carlos Trevino said.
The Mulach 1 discovery, located 17km (11mi) from Paraiso, Tabasco, in shallow waters at a depth of 21m (69 ft), is expected to produce between 20,000b/d and 30,000 b/d. It contains "super light crude, above 78°API," Javier Hinojosa, director of exploration and production, told Argus.
Liquid hydrocarbons with an API of above 50° are typically considered to be condensates.
The Manik 101A discovery, located 102km from Ciudad del Carmen, Campeche, in shallow waters at a depth of 90m, is expected to produce between 10,000 b/d and 15,000 b/d of light crude. Manik's reserves are estimated at a gravity of 20°API. Mexico's heavy sour Maya crude has a gravity of 22 API°and 3.3pc sulfur.
"The two new discoveries are among the most important shallow-water discoveries in the world over the past fifteen years," energy minister Joaquin Coldwell said during the event.
Yet the size of the discoveries pale in comparison to the Zama 1 discovery with estimated reserves of 1.8bn bl of oil announced last year by Talos Energy in nearby shallow waters.
The discovery well, known as Zama 1, contained light oil with API gravities ranging 28° to 30°.
Talos Energy, together with Sierra Oil and Gas and Premier Oil, won development rights for the shallow water block 2 and block 7 in the first round of tenders overseen by oil regulator CNH. Both blocks are located in the southeast basin, a proven hydrocarbon province in shallow waters off the Veracruz and Tabasco states. Block 2, north of Coatzacoalcos, and block 7, north of Comalcalco contain numerous prospects in well-established and emerging plays.
Development of the Pemex discoveries will fall to the incoming administration "under the schemes that they are proposing," Hinojosa said, without elaborating further.
President-elect Andres Manuel Lopez Obrador will take office on 1 December and has set his sights on "rescuing Pemex" and increasing oil production to 2.6mn b/d by the end of his term in 2024.
Mexican crude production dropped 29pc to 1.8mn b/d in August this year from 2.54mn b/d in all of 2012, according to the latest information from Pemex.
Together with the new discoveries, a further four fields — in the process of delimitation and moving towards production — "have the potential to contribute up to 210,000 b/d of oil and 350mn cf/d of gas to Pemex production," Trevino said today.
Trevino said all six fields should be in production by the third or fourth quarter of 2020.
Pemex is working to start production in the Esah and Xikin fields, discovered in 2015, to add an additional 360mn bl of crude oil equivalent to national reserves, said Trevino.
The Xikin field, 31km from Paraiso in shallow waters at a depth of 24km, is expected to produce 70,000 b/d of oil and 91mn cf/d of gas. The field is near existing Pemex infrastructure, allowing production to start in 2019.
"It is light crude, the type of crude that we most need in our refineries," Trevino said.
The Esah 1 field, located 94km from Ciudad del Carmen in shallow waters at a depth of 67m is expected to produce 23,000 b/d of oil and 9mn cf/d of gas. Pemex expects production to start in March 2020.
Meanwhile, the Kinbe and Koban fields, discovered in 2011 and 2016, are currently in the process of delimitation and would add 325mn bl of crude oil equivalent in 3P reserves, said Trevino.
The Kinbe field, located 28km from Frontera, Tabasco, in shallow waters at a depth of 21 meters, produced around 5,000 b/d of oil during production testing and is expected to produce 24,000 b/d of oil and 35mn cf/d of gas.
The Koban field, located 4km from Frontera, in shallow waters at a depth of 11m is expected to produce 46,000 b/d of oil and 219mn cf/d of gas.
Pemex said it will carry out and finance the delimitation and start of production in all four fields, with the "heaviest investments" required in Esah and Xikin, Hinojosa said. Pemex plans to invest around $50mn in drilling 20 wells in Esah and Xikin and up to $150mn in the construction of two drilling platforms.
Related news posts
New US rule may let some shippers swap railroads
New US rule may let some shippers swap railroads
Washington, 30 April (Argus) — US rail regulators today issued a final rule designed to help customers switch railroads in cases of poor rail service, but it is already drawing mixed reviews. Reciprocal switching, which allows freight shippers or receivers captive to a single railroad to access to an alternate carrier, has been allowed under US Surface Transportation Board (STB) rules. But shippers had not used existing STB rules to petition for reciprocal switching in 35 years, prompting regulators to revise rules to encourage shippers to pursue switching while helping resolve service problems. "The rule adopted today has broken new ground in the effort to provide competitive options in an extraordinarily consolidated rail industry," said outgoing STB chairman Martin Oberman. The five-person board unanimously approved a rule that would allow the board to order a reciprocal switching agreement if a facility's rail service falls below specified levels. Orders would be for 3-5 years. "Given the repeated episodes of severe service deterioration in recent years, and the continuing impediments to robust and consistent rail service despite the recent improvements accomplished by Class I carriers, the board has chosen to focus on making reciprocal switching available to shippers who have suffered service problems over an extended period of time," Oberman said today. STB commissioner Robert Primus voted to approve the rule, but also said it did not go far enough. The rule adopted today is "unlikely to accomplish what the board set out to do" since it does not cover freight moving under contract, he said. "I am voting for the final rule because something is better than nothing," Primus said. But he said the rule also does nothing to address competition in the rail industry. The Association of American Railroads (AAR) is reviewing the 154-page final rule, but carriers have been historically opposed to reciprocal switching proposals. "Railroads have been clear about the risks of expanded switching and the resulting slippery slope toward unjustified market intervention," AAR said. But the trade group was pleased that STB rejected "previous proposals that amounted to open access," which is a broad term for proposals that call for railroads to allow other carriers to operate over their tracks. The American Short Line and Regional Railroad Association declined to comment but has indicated it does not expect the rule to have an appreciable impact on shortline traffic, service or operations. Today's rule has drawn mixed reactions from some shipper groups. The National Industrial Transportation League (NITL), which filed its own reciprocal switching proposal in 2011, said it was encouraged by the collection of service metrics required under the rule. But "it is disheartened by its narrow scope as it does not appear to apply to the vast majority of freight rail traffic that moves under contracts or is subject to commodity exemptions," said NITL executive director Nancy O'Liddy, noting it was a departure from the group's original petition which sought switching as a way to facilitate railroad economic competitiveness. The Chlorine Institute said, in its initial analysis, that it does not "see significant benefit for our shipper members since it excludes contract traffic which covers the vast majority of chlorine and other relevant chemical shipments." By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
First TMX cargo booked on Aframax to China
First TMX cargo booked on Aframax to China
Houston, 30 April (Argus) — The first cargo shipped on the Trans Mountain Expansion (TMX) crude pipeline is scheduled to load on an Aframax in Vancouver, British Columbia, beginning 18 May for June delivery in China, according to sources with knowledge of the transaction. Suncor provisionally booked the Aframax Dubai Angel for a Vancouver-China voyage at $3.5mn lumpsum, equivalent to $6.39/bl for Access Western Blend, market participants said. In March, China's state-run Sinochem purchased the first TMX cargo — 550,000 bl of Canadian Access Western Blend — for June delivery. The shipping fixture would mark the first Vancouver-China crude delivery since May 2023, according to Vortexa, a possible indicator of steady Asia-Pacific demand to come with increased maritime access for Canadian oil producers. China already receives heavy sour Canadian crude re-exported from the US Gulf coast, with about 110,000 b/d arriving in 2023, Vortexa data show. The new 590,000 b/d pipeline begins commercial service on 1 May, with three Aframax-capable berths at Vancouver's Westridge Marine Terminal, up from one previously. An oversupply of Aframax crude tankers on the west coast of the Americas in anticipation of TMX-driven demand pressured Vancouver-loading rates to six-month lows on 19 April , according to Argus data, but market participants expect demand to increase beginning in the second half of May. Three regulatory approvals remained under assessment by the Canada Energy Regulator (CER) on 30 April. The applications concern piping, valves and other components at two pipeline inspection device traps and the mainline pipe between the two traps. The traps were added for safety assurance when the operator was allowed by CER to use a smaller diameter pipe as part of the Mountain 3 deviation. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Canada’s TMX awaits regulator OK on eve of service
Canada’s TMX awaits regulator OK on eve of service
Calgary, 30 April (Argus) — Regulatory approvals needed for the 590,000 b/d Trans Mountain Expansion (TMX) crude pipeline in western Canada are coming down to the wire on the eve of entering commercial service. The major crude pipeline last week maintained its plan to start commercial operations on 1 May, but three filings remain under assessment by the Canada Energy Regulator (CER) with less than 24 hours to go. Federally-owned Trans Mountain requires all sections, called spreads, of the pipeline to receive regulatory blessing before the line can be put into service. Outstanding are applications pertaining to Spread 5B Part 3, which runs from kilometer post 1064 to 1067, according to CER's website. The segment is near Hope, British Columbia, about 140 kilometers (87 miles) east of the line's terminus in Burnaby. The three applications concern piping, valves and other components at two pipeline inspection gauge (pig) traps and the mainline pipe between the two traps. The traps were added for safety assurance when the operator was allowed by CER to use a smaller diameter pipe as part of the Mountain 3 deviation. Mountain 3 was the last segment of the pipeline to be constructed because of delays relating to difficult terrain while tunneling. TMX will nearly triple the existing 300,000 b/d Trans Mountain system that connects oil-rich Alberta to the docks in Burnaby, British Columbia. Importantly, the line will provide Canadian oil sands producers with a significant export outlet without having to first go through the US. The "golden weld" marking the end of construction occurred on 11 April, according to Trans Mountain. A group of shippers last week expressed concern that TMX would not be ready for commercial service by 1 May. Spreads 6, 7A and 7B stretching from kilometer post 1075 to 1180 were approved earlier in the week, bringing the total number of approvals up to 39. The expansion was first conceived more than a decade ago with the intention of being operational by late-2017, but that date slipped amid cost overruns and repeated delays. By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US crude output rebounds by 4.6pc in February: EIA
US crude output rebounds by 4.6pc in February: EIA
Calgary, 30 April (Argus) — US crude output rebounded by 4.6pc in February after freezing temperatures in the prior month took production offline in the three largest producing states. Output averaged 13.15mn b/d in February, up by 578,000 b/d from January, the Energy Information Administration (EIA) said today in its Petroleum Supply Monthly report. February's production was up by 622,000 b/d from February 2023 but remained short of the 13.3mn b/d record high set in November 2023. North Dakota was hit particularly hard by winter storms in January, which temporarily knocked as much as 700,000 b/d of production offline. The country's third-largest producing state pumped out 1.29mn b/d during February, up by 173,000 b/d from January and 159,000 b/d higher than in February 2023. About 86pc of North Dakota's production was 40.1°API or higher, according to the EIA. Texas, home to more than 40pc of the country's crude production, pumped out 5.55mn b/d in February. This was up by 172,000 b/d from January and 242,000 b/d higher than February 2023. New Mexico, which shares the prolific Permian basin with Texas, also boosted its output in February with 1.98mn b/d of production. This was up by 120,000 b/d from January and up by 183,000 b/d from February 2023. Similar to North Dakota, about 91pc of crude produced in New Mexico was 40.1°API or higher, while in Texas about 55pc of output fell into that category. About 44pc of all crude produced in Texas fell into the relatively heavier 30.1-40°API range. US output in the Gulf of Mexico came in at 1.8mn b/d in February, up from the 1.78mn b/d produced in the prior month but down by 28,000 b/d from February 2023. Almost all the crude produced in the Gulf of Mexico was 40°API or lower. By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more