Pemex should avoid moving to production too fast at priority fields: panelists

Mexico City — Mexico's state Pemex should avoid moving to production without properly evaluating the potential of fields, panelists said Nov. 20.

Fields that have a discovery well must be evaluated completely to determine theirs size and figure out how much they could add to the country's reserves, said Alma America Porres Luna, one of the five commissioners at the National Hydrocarbons Commission. Her comments came during a webcast panel on the production of the 20 projects Pemex has called priority, organized by the Mexico-based journal Oil&Gas Magazine.

"Pemex has recently submitted development plans for fields that turn out to have very little resources after simple analysis," Porres Luna said. Pemex has since realized it makes no economic sense to continue exploring and has cancelled all activity in most of those projects, she said, adding that in the near term, that lack of success in the exploration and production will have a negative effect on reserves.

Pemex is seeking to boost output by roughly 300,000 b/d by December, and is focusing on 20 projects the government identified as a priority in 2019. Those projects were thought to have the potential resources to compensate for declining production at Ku Maloob Zaap, the country's biggest producing complex.

"Quesqui is an example of a field that has been drilled and as it looked promising it has already been set for early production," Porres Luna said. Quesqui was discovered in December 2019 and has already had an accumulated production of almost 80,000 barrels, according to CNH data.

This is not a new phenomenon. Pemex has for decades made little analysis of the fields under its operation and made production estimates based on insufficient data, said Marbellys Chacon, a consultant at R2M during the panel talk.

"Pemex should be more honest and recognize that perhaps the resources are fewer than originally estimated," Chacon said.

The Mexican government promised in 2019 it would announce 20 more projects every year to help the administration reach its goal of increasing output to 2.4 million b/d by 2024. However, it has yet to announce the projects for 2020, and has replaced some of the original 20 announced in 2019.

Pemex could not be reached for comment.