CNH Reports on Its Activities in November

The National Hydrocarbons Commission (CNH) reported on its activities in November, during which it held 11 working sessions. As a result, the commission approved the drilling of 9 exploratory wells with prospective resources of 525.4MMboe.

Regarding exploration, CNH approved two exploration plans and 11 work plans for 2023 so far, which include 57 exploration wells. The activities approved are equivalent to an investment of US$1.3 billion.

For development, CNH approved three exploration and extraction plans and three working plans for 2023. The approvals permit the drilling of 56 development wells, plus the termination and drilling of another 47 wells. CNH approved 45 major repairs and 1,440 minor ones. The projection for retrieval is 660.38MMb and 3.25Bcf. 

CNH also approved two transition programs with production expectations of 2.25MMb of oil and 2.16Bcf of gas. The investment for these operations is US$257.36 million. For evaluation purposes, the CNH approved one evaluation program and one work program for 2023 to drill two delimiting wells with an investment of US$7.58 million.

November was the first month that the CNH operated under its new Director, Agustín Díaz Lastra. In September, when former director Rogelio Hernández Cázares resigned, CNH ceased to be operational since it could no longer reach a quorum. Díaz was one of the three options that President López Obrador presented to the Senate.

So far, private companies have abandoned 23 areas previously granted for exploration and extraction. Last week Woodside abandoned part of its Trion exploration area and decided to focus on reserves already found in the area. Among the companies that abandoned other exploration areas are Pantera Exploración y Producción, Capricorn Energy, Vista Oil and Gas, TotalEnergies, BP Exploration, Hokchi Energy, Equinor, Carigali, and Repsol. According to  CNH, these are normal processes as companies decide to focus on higher-value projects. However, since the government canceled bidding rounds and farm-outs, there are no ways left to allocate more contract areas.

According to CNH, private oil production decreased in October 2022. Private players produced 105Mb/d, a month-over-month decrease of 7.5 percent. While president López Obrador set a goal for private companies to produce 280Mb/d with the Mexican Association of Hydrocarbon Companies (AMEXHI), the latter might redefine this projection. AMEXHI projected production of 209Mb/d for 2022, yet so far, the current production estimation is 49 percent below this goal. The biggest decrease in production was reported by Fieldwood Energy and Petrobal since they reported a 27 percent decrease in production at the Ichalkil and Pokoch fields compared to September.