(Reuters, 29.Jan.2020) — Mexico’s state oil company Petroleos Mexicanos wants operational control over a major offshore oil area discovered by a consortium of private companies before development gets underway, its top official said on Wednesday.
Pemex Chief Executive Officer Octavio Romero told a news conference the company believes most of the crude found by the consortium, in the largest oil discovery made by any private firm in Mexico in decades, lies in an adjacent block where it holds development rights.
“This reservoir is shared,” Romero said, confirming that Pemex believes the so-called Zama discovery extends from the area operated by U.S.-based Talos Energy Inc into its own neighboring block.
The fight for control of Zama could mark a turning point for President Andres Manuel Lopez Obrador, a leftist who favors a state-centric energy industry, as he seeks to boost the economy without scaring off private sector investors.
“Pemex also wants to be the operator of this field,” Romero said, referring to who should be in charge of commercially developing the area. He said a company analysis showed that “most” of the Zama reservoir was in the adjoining block belonging to Pemex.
Romero did not provide details of the analysis of the area, located along the southern rim of the Gulf of Mexico.
The offshore Zama find was made by a group led by Talos in 2017, just two years after it won rights to the area. Reuters reported last year that Pemex was seeking control of the project.
The Talos-led consortium has already drilled several exploratory wells on its block and has been negotiating behind closed doors for about a year with Pemex over a joint scheme to develop the field, but no agreement has been announced.
Earlier this month, Talos said a third-party study by Netherland, Sewell & Associates – a technical oil consulting firm that Pemex has also used in the past – estimated that 60% of the roughly 700 million barrel find lies in the Talos block, while Pemex holds 40%.
Romero appeared to dismiss that breakdown as an “interpretation.”
Despite repeated pledges to do so, Pemex has yet to drill its exploratory Asab well on its portion. But Romero said the heavily-indebted firm would like to also develop two additional, nearby prospects on acreage it already controls.
Such a cluster would promote efficient development of the oil and gas riches below, even bringing production online faster than Talos’ estimation, Romero said.
“There are two other potential reservoirs (nearby): one called Nikita and another called Chamak, which constitute a development cluster that we’re looking to create that will slash operating costs by a lot,” he said.
Two week ago, Pemex’s exploration and production arm sought and received authorization from regulators to drill the Nikita well, but no such authorization has yet been given to drill Chamak.
Pemex has struggled with 15 consecutive years of declining oil production. The company’s critics have also highlighted that it has not invested enough for decades to explore and confirm discoveries.
“We think Asab can enter into production next year. They are thinking production won’t happen until 2024,” Romero said, in an apparent reference to the Talos-led consortium, which also includes Germany’s Wintershall Dea and Britain’s Primier Oil.
Talos did not immediately respond to a request for comment on Romero’s remarks to reporters.
Reporting by Ana Isabel Martinez; Additional reporting and writing by David Alire Garcia; Editing by Marguerita Choy and Tom Brown