Mexico's Pemex Looks to Boost Gas and Oil Reserves During Sheinbaum Presidency

SEATTLE (Oil Monster): Mexican state oil company Pemex aims to increase its hydrocarbon reserves and ensure their restitution during the government of newly elected President Claudia Sheinbaum, according to an internal Pemex document seen by Reuters on Wednesday.

Pemex will also intensify deepwater exploration and develop new business models to attract investment, the document shows.

During the six-year administration of Sheinbaum's predecessor, Andres Manuel Lopez Obrador, Pemex had put aside deepwater exploration to focus on projects that would deliver production quickly, although many have started to decline early.

Pemex did not immediately respond to a Reuters request for comment. Sheinbaum’s office did not directly answer the Reuters request for comment.

Pemex would also look to develop new business models to attract external investment, the document showed, after Lopez Obrador did not seek partnerships with private companies to develop exploration and extraction projects.

Lopez Obrador had ended the bidding for contracts introduced during the energy reform a decade ago, arguing that resource wealth was being handed over to private and foreign companies at the expense of Pemex.

Pemex already has a partnership with Australia's Woodside Energy, signed in 2017, for the Trion field in ultra-deep waters of the Gulf of Mexico. As a result of the energy reform, Woodside has a 60% stake in the project and is the operator. Pemex owns 40% and serves as a financial partner.

Trion, which has proven reserves of 287 million barrels of crude oil and 323 billion cubic feet of gas, is expected to begin production in 2028. Sources recently told Reuters that the government of Sheinbaum would seek to reactivate Pemex partnerships with private companies to increase hydrocarbon reserves. Pemex's internal document indicates that the state company would maintain onshore exploratory activity, shallow waters and in areas surrounding production fields. It would also concentrate efforts on selecting exploration and production projects that offer the "greatest potential for success and profitability" in addition to mitigating the decline of fields and strengthening the development of new ones. Pemex, one of the most indebted oil companies in the world, produces on average 1.5 million barrels per day (bpd) of crude oil, excluding condensate. Adding condensate, its production rises to 1.8 million bpd. Sheinbaum, who took office on Oct. 1, has said that she would seek to maintain current levels of crude oil production during her six years in office.

Courtesy: www.reuters.com