Mexico’s oil and natural gas fields are so near but yet so far from the United States, where the hydraulic fracturing (fracking) and horizontal drilling revolution have turned it into a global behemoth. Now Mexico stands poised as an unconventional threat as well.
The Eagle Ford Shale in South Texas, in the cradle of the unconventional fields, extends into the Mexican state of Tamaulipas. But while the small companies that were the guerrilla fighters of the revolution continue to buzz the formation in Texas with drilling activity, the Tamaulipas side is eerily silent.Mexico’s state oil company Petroleos Mexicanos (Pemex) drilled about 20 wells a few years ago, but without apparently being unable to master the fracking/horizontal drilling technology.
This time round, with the instruments of the 2013-14 energy reform under their belt, the Mexican energy authorities have announced the nation’s first upstream auction of unconventional resources in the wake of a government-sponsored forum in the border city of Reynosa, Tamaulipas.
Source: In the Shadow of the U.S., Mexico Strives to Generate a Homespun Fracking Revolution | 2018-02-21 | Natural Gas Intelligence
After years of delay, Mexico could open up its vast shale oil fields to U.S. drillers as soon as next year, the Mexican secretary of energy said Friday. Pedro Joaquin Coldwell, speaking to energy executives, attorneys and academics at Rice University, said that the long-suspended auctions for northern Mexico’s shale fields could reopen after the first quarter of 2017. “Everything will be ready by March,” he said. The fields could provide Houston oil companies with nearby and ready-made opportunities for expansion. Much of it is essentially an extension of the Eagle Ford reservoir, which stretches from central Texas and into Mexico. Local companies, familiar with the geology and now experts in hydraulic fracturing, could be first in line to develop the fields. Mexico, in the middle of sweeping energy reform, is holding auctions to sell the rights for private companies to drill in its untapped oil fields. The country has gathered more than $22 billion in private sector commitments so far, on projects ranging from oil drilling to pipelines to power plants.
Source: Mexican shale fields may open next year – MRT.com: Oil & Gas
With nine oil and gas leases coming up for bid just across the border from Texas, several Mexican companies will soon be arriving in the Lone Star State to get a peek at the technology and skills that made the Eagle Ford Shale one of the most prolific fields in the United States.The San Antonio-based Eagle Ford Consortium is hosting a ” Texas-Mexico Business Forum” at the International Center for Trade in Eagle Pass on Sept. 22 and 23.
Source: Mexican service companies to get a peek at Eagle Ford “know how” – San Antonio Business Journal
Mexico will publish between March and April the new number of fields of shale and other more expensive oil and gas deposits to be tendered under an energy reform finalized last year, the National Hydrocarbons Commission (NHC) said on Monday.
The government has for weeks signaled the need to scale back some costlier fields amid a sharp drop in oil prices.
“A redefinition is required, looking at the reality of the markets,” NHC President Juan Carlos Zepeda told reporters.
The likely reduced number of blocks for the exploration and production of shale and other more expensive oil and gas deposits, including parts of the Chicontepec basin, will be published between March and April, he said.
via Mexico to reveal next set of oil tenders between March-April | Reuters.
Major international oil firms including Exxon Mobil Corp. and Royal Dutch Shell PLC are showing interest in the initial phase of a bidding round for exploratory oil and gas blocks in the shallow waters of the Gulf of Mexico that will be assigned by the government midyear, a top energy official said Monday.
The recent plunge in oil prices appears to not to have affected the shallow-water phase of the bidding round because of modest production costs, while a later phase involving more costly production in shale-rock formations will be trimmed back to offer only the most attractive of the so-called unconventional resources, said Juan Carlos Zepeda, head of the National Hydrocarbons Commission.
The commission is overseeing what Mexico is calling “round one,” since it is the first of its kind since an energy overhaul last year that ended the 76-year government monopoly on oil exploration and production by national firm Petroleos Mexicanos, or Pemex.
“Even in this price environment, the round is moving forward quite well,” Mr. Zepeda told journalists during a tour of “data rooms” where oil companies can see seismic and other data on the areas prior to bidding.
Among the seven companies that have been authorized into the data rooms–after paying fees–are Exxon Mobil, Chevron Corp., Shell, Ecopetrol SA and BG Group PLC, the commission said in a press release. A total of 30 companies have shown some interest in the process short of paying for entry into the data rooms, the commission said.
Mr. Zepeda said the shallow-water round is in an area of the Gulf of Mexico where there is already significant oil production and where costs are less than $20 a barrel, making them attractive even in the current environment of depressed prices.
via Oil Majors Show Early Interest in Mexico Bidding Round – NASDAQ.com.
Mexico’s sovereign oil fund, created as part of the country’s energy reforms, has begun to operate, according to the central bank.The oil fund for stabilization and development will receive, manage and distribute the revenues from the hydrocarbons sector, transferring funds to the government.Surplus funds will be channeled into a long-term savings plan for future generations, the central bank said in a statement. The oil fund will finance oil and gas E&P, as well as infrastructure, pensions and research and development projects, bank governor Agustín Carstens told legislators in June.In testimony before treasury and energy committee lawmakers debating the reform’s secondary legislation, Carstens said such funds have proven successful in at least 26 other countries.Until now, Mexico’s government had used oil revenue exclusively for budgetary purposes and not for investment. The fund is reportedly modeled on Norway’s sovereign wealth fund, the world’s largest and totaling around US$850bn.Once the fund has reached 3% of GDP, any surplus will be allotted as follows: at least 40% to remain in the oil fund; at least 10% will go to the universal pension fund; 10% to invest in science and technology projects; and another 10% in scholarships and industry connectivity and development projects, Carstens said.The fund will be a tool for transparency, with which Mexicans will be able to see the origin and destination of the oil and gas revenues it manages.
Fund website: http://www.fmped.org.mx/
via Mexico launches sovereign oil fund – BNamericas.
Mexico’s historic energy reforms go into effect on Jan. 1, but officials have just released technical documents that outline rules for imports and exports in this new market.After more than 70 years of strict national control, Mexico is opening its oil and natural gas markets to foreign investment. But the nuts and bolts of how the new oil and natural gas markets will work has become clearer.Mexico’s Ministry of Economy (SE) has released technical documents on their website that outline imports and exports under the rules. The documents include a series of complex formulas that U.S. producers can use to determine how much profit and oil they get to keep for themselves.
via Mexico lays out blueprint for energy imports and exports – San Antonio Business Journal.
Mexico could defer the auction of some high-cost shale and deepwater acreage as a result of falling oil prices, senior officials said today.They said Mexico had been “quite ambitious” on shale blocks before prices starting tanking in mid-2014, making adjustments very likely.Shale and deepwater blocks are scheduled to be offered around March-April 2015 under a staggered first licensing round that got underway yesterday with 14 shallow water exploration blocks. Bids are due on 15 July.The application process to access the data room for the shallow water blocks will begin on 15 December, and the data room will open on 15 January.
via News – Argus Media.
A sense of urgency, concern and optimism flowed through the 34th annual meeting of the Latin American Petrochemical Association APLA in Rio de Janeiro, Brazil. Increased competition from US shale gas-based petrochemical and polymers production is only expected to intensify in the years ahead as new capacities come online with a bull’s-eye on Latin American markets.But the first major project in the Americas to start up in the olefins space will be Mexico’s Ethylene XXI by Braskem Idesa, comprising a 1.05m tonne/year cracker and polyethylene PE units set to commence commercial operations near the fourth quarter of 2015.Ethylene XXI was hailed as the “most important project in Mexico in 40 years”, according to Jordy Herrera Flores, the former energy secretary of Mexico.And Mexico’s energy reforms, the positive implications for increased hydrocarbon production and resulting boom in feedstocks for the petrochemical sector provided fuel for optimism throughout the meeting.Indeed, just about every new petrochemical project divulged at the APLA meeting is taking place in Mexico. This includes Alpek’s planned on-purpose propylene plant of 400,000 to 500,000 tonnes/year, using either propane dehydrogenation PDH or methane-to-propylene MTP technology – both based on local natural gas.Alpek is also planning a 750,000 tonne/year ethylene glycol EG project in Mexico, while Pemex plans to expand its ethylene oxide EO/EG facility by 80,000 tonnes/year and build a new 500,000 tonne/year paraxylene project in the country.Meanwhile, Mexico’s Idesa is aiming to more than double ethanolamines production by 50,000 tonnes/year at Coatzacoalcos.
via Commentary: Sense of urgency strikes Latin America petrochemical industry at APLA.