Halliburton Goes Gangbusters in Chicontepec

(Blogger's note: It will be made very clear that Halliburton - a virus of a company that nefariously piggy-backs Uncle Sam's dime in the Iraqi War, and under some operations, actually costs the taxpayer more money (than if than if the matter was conducted by the military itself) - is a company not endorsed by the blog. Again, while it shall be stated that Ghawar Guzzler is not a political blog, the blogger never endorsed the Iraqi War, nor the war-profiteers who've gained from it)

Halliburton plans to drill 170 wells in Chicontepec:

Petroleos Mexicanos has awarded Halliburton Co. a $159 million contract to drill 170 wells in Mexico's Chicontepec region, marking the Houston-based company's debut in an area where its main competitors have an established presence.

Pemex, as Mexico's state oil company is known, said the contract will last three years and involve four drilling rigs. Mexico is ramping up activity at Chicontepec to compensate for declining production at the country's traditional oil fields.

Pemex expects Chicontepec to pump 40,000 barrels a day in August and 60,000 barrels a day by the end of the year. At the start of 2009 the company had higher expectations of 70,000 barrels a day on average; it expects over 700,000 bpd by 2017.

- Brewskie

Who Needs Cantarell?

One of the most popular firearms for this peakers' drive by shooting summer is the Canatrell collapse cannon. "Canterll collapsed in 2004 at 2 mbpd. It's down to 700,000 bpd; it's no longer Mexico's largest-producing field (Ku Maloob Zaap is)! I say: who needs it?

In 2007, Mexico was supplying America with 1.3 mbpd, making it effectively America's 3rd largest supplier. However, like much of the developed world, America has shrank the flubby ballast in response to high oil price overdose. As we can see from the graph below...

her appetite has shrunk considerably from the 21+ mbpd day she gorged on back in 2005, to under 19 mbpd currently. A recent estimate holds steady at 18.74 mbpd; the 2Q US oil usage is projected to be 4.2% lower than of last year, making it the lowest in 12 years. Don't slack now kids, let's keep up the good work!

As I've also posted before, despite Canatrell and the N Sea's seemingly sharp drops, non-OPEC crude production hasn't declined that catastrophically since its record in 2004:

She's declined an average of roughly 1 mbpd - that's an annual depletion rate of less than 1%! That's a far cry from the peakers' call of 5%, 6.5% 8% (I've even heard as high as 13%!). It also fits the debunkers' assertion that global peak will result in a slow decline, not a hard crash. It seems King Hubbert thought so, too.

So while Canatrell is giving up the ghost, OECD countries move on without a care...

And let's not forget that non-OPEC total liquids has been kicking ass; that we have our friendly neighbor to the north, Canada, who in good time pick up the slack where Mexico is leaving off (with unpardonable environmental sins, of course). So I say... let Canatrell die, because with 700,000 bpd to date, it can't hurt things much more.

In actuality, there is one country that needs Canatrell badly: Mexico. This impoverished nation receives 40% of its federal budget through oil revenues. With declining oil revenue, Mexico is still loaded with poverty, illiteracy, gangs, drug wars and guns. Somebody might want to tell Dr. Wirth he may want to reconsider his location for a peak oil sustainability.

- Brewskie

Carlos Slim to Unload Cash on Chicontepec

Two monopolists - Carlos Slim and Mexico's state-owned oil company, Petroleos Mexicanos (Pemex) - are setting their eyes on Mexico's next big oil play, Chicontepec.

From the dudes over at Rigzone:

Mexican tycoon Carlos Slim (telecoms) has set his sights on Chicontepec, an oil project that state monopoly Petroleos Mexicanos is plowing money into despite the price crash.

Slim's Servicios Integrales GSM has attended project meetings and paid bidding fees for a 170-well contract, according to documents on Mexico's Compranet government procurement Web site.

Industry executives expect the unit of industrial conglomerate Grupo Carso SAB to be a main competitor when bids come in on April 7.

[...]

Slim, a telecoms magnate ranked by Forbes magazine as the world's third richest man, has sprawling industrial concerns that rake in profitable government contracts ranging from highways to water treatment plants. At Chicontepec, Pemex plans to invest $11 billion over the next four years, making it an attractive target for drillers struggling with a global industry down cycle.

The upcoming contract is designed to attract smaller companies looking for a foothold at Chicontepec and to give Pemex a more diverse pool of suppliers. The previous two contracts were each for 500 wells, three times as large.

Halliburton, Baker Hughes, and Nabors Industries Ltd., as well as China's Sinopec, are all looking to set up shop at Chicontepec.

[...]

Slim's engineering and construction companies have built offshore platforms and other infrastructure for Pemex. He was even briefly a member of Pemex's board in 2001 under an effort by then-president Vicente Fox to make the state oil monopoly more efficient. Slim and other businessmen named to the board were withdrawn, however, after the move caused an outburst of oil nationalism.

- Brewskie

Pemex Discovers "Significant" Oil and Gas Discoveries

Mexico's state-owned oil company, Pemex, reported "sigificant" oil and gas discoveries in the Gulf of Mexico. Details are sketchy, but info. is as stated (link):

Mexico's state-owned Petroleos Mexicanos, which has budgeted more than $12.2 billion for oil and gas exploration in 2009-12, has discovered "significant" amounts of natural gas and condensate with its Tsimin-1 wildcat well drilled in the Gulf of Mexico.

The Tsimin-1 well had initial production of 4,400 boe/d, Pemex said.

Meanwhile, the state firm also announced the onset of gas production of the Cali-1 well in its Burgos project, with production starting at 9.1 MMcfd of gas.

Pemex, which drilled the discovery well in August 2008 on Mision block in Burgos, said the development of the field will provide an additional 90-110 MMcfd of gas.

Pemex also listed four light oil discoveries in its fourth-quarter 2008 financial results, with the Xanab-DL1 offshore well being the most productive at 9,200 b/d of oil.

The discoveries coincide with a statement by Pemex Chief Executive Officer Jesus Reyes Heroles stating that the firm likely discovered 30-35% more oil and gas in 2008 than in 2007.

"It was a very good year in general terms and very important with respect to the previous year," Reyes Heroles said. During 2007, 1.053 billion boe were incorporated, he said. He said the firm, before making any more details public, is awaiting final certification of its reserves by independent consulting firms.

Last month, as part of its effort to boost production, Pemex Exploration & Production let a contract to J. Ray McDermott SA, Houston, to transport and install the Ixtal-B and Maloob-C drilling platforms in the Bay of Campeche, Mexico (OGJ Online, Feb. 11, 2009).

- Brewskie

Mexico Gearing Up for Chicontepec Pay Dirt

Mexico announced plans for a 170-well tender at Chicontepec, a giant oil region that spans three states in northern Mexico. Pemex plans to pump 700,000 bpd from Chicontepec by 2017

From the article:

Pemex said it will pick the winning bid on April 7 with work starting in early May and lasting two years. Pemex often runs into bureaucratic delays in assigning large contracts.

Late last year Pemex announced two Chicontepec drilling tenders, each for 500 wells, that have attracted interest from oil-services giants Schlumberger Ltd. ( SLB), Halliburton Co. (HAL) and Weatherford International Ltd. (WFT).

Mexico's urgent need to bring new oil fields into production has made the country a bright spot for oil-services firms during a year when most oil companies are cutting their investment budgets due to low oil prices.

[...]

Chicontepec is a main pillar in Pemex's strategy to get oil production back above 3 million barrels a day by 2015. Pemex expects to be producing only 72,000 barrels a day at the basin this year despite two years of aggressive drilling. But by 2015 Pemex says Chicontepec will be producing 511,000 barrels a day, or a sixth of total output.

- Brewskie