Offshore staff
(Mexico, GoM) - Mexico's President Vicente Fox says a new deepwater oil discovery in Mexico's GoM could eventually yield 10 Bbbl of crude oil.
An exploratory well, Noxal 1, was drilled at a depth of 3,070 ft (935 m) below the water, and is seeking a depth of 13,125 feet (4,000 m).
Noxal 1 is Pemex's fourth deepwater exploratory well.
Perforation of the well, about 60 mi (100 km) from Coatzacoalcos on the coast of Veracruz state, began in December.
Pemex expects the new find to offset further decline in production at its offshore Cantarell field that is expected in coming years.
Located in shallow water off Campeche state, Cantarell accounted for about 60% of the total 3.3 MMb/d day that Mexico pumped last year.
Production peaked in 2004 at about 2.2 MMb/d, and analysts say output could begin falling by 10% or more annually within a few years.
Mexico's total oil and gas reserves slipped to 46.4 Bboe at the end of 2005 from 46.9 Bboe a year earlier, says Pemex CEO Luis Ramirez.
Ramirez says that while production tests will be conducted in coming weeks, "evidence found is sufficient to infer potential reserves to be discovered that could reach 10 Bboe.
"This number, compared with annual production of 1.6 Bbbl of crude, shows its strategic importance," Ramirez says, adding that crude oil production at Noxal likely won't begin for eight to 10 years.
Pemex had contracted a private company to drill the well.
Current laws forbid private companies from E&P activities in Mexico except when they are under contract to Pemex.
The Fox administration has been attempting to change the foreign investment restrictions in the state-run energy sector, but the initiatives have been blocked by Mexico's Congress.
Fox says the government has invested more than $6.3 billion in exploration in the last five years.
Pemex produced 3.33 MMb/d of crude oil last year, of which it exported 1.82 MMbbl.
This year, the company expects to raise production to about 3.42 MMb/d.
Pemex hit its first deepwater oil in late 2004, when it contracted Diamond Offshore Drilling to drill a well at a depth of 681 m (2,235 ft) in Campeche Sound, producing an initial flow of 1,200 b/d.
03/15/06
