Mario Hernández
Director General
View from the Top

Creating Value by Optimizing Natural Gas Management

Wed, 01/22/2014 - 12:56

Q: What are most significant projects Nuvoil has had with PEMEX over the past years?

A: One of our most important projects with PEMEX in 2013 was a CO2 separation and elimination plant in the Tres Hermanos field in Poza Rica, as part of PEMEX’s Clean Development Program. As of today, we have been very successful in separating CO2 from hydrocarbons, confirming our reliability as a partner in its Clean Development Program. We are also entering into artificial production systems, which are very important given the large amount of abandoned wells with production potential that Mexico still has. Production at those wells could be seen as marginal, but PEMEX lists more than 5,000 and a significant amount of oil could be recovered from them.

Nuvoil has also been helping PEMEX to manage and compress natural gas through two main strategies. The first is increasing pressure in pipelines in order to deploy natural gas to the consumption nodes. The second involves wellhead management for natural gas and self-sufficient compression systems to improve well productivity. Nuvoil has worked on wellhead gas compression around Villahermosa, in Chicontepec, and in Veracruz to increase field production. We are also developing a reservoir air injection project for PEMEX at Bellota-Jujo in the Cárdenas field. This will be the first reservoir where an air injection project will be developed in Latin America. It is unique because of the reservoir’s lithology, made up of carbonate rock, whereas similar projects have traditionally been executed in sandstone reservoirs. We are very hopeful about the project’s success in increasing the reservoir’s recovery factor, which would be a very positive achievement for PEMEX.

Q: How will Nuvoil seize business opportunities provided by gas flaring in conjunction with new environmental protection policies?

A: We have been working in that area ever since environmental requirements were implemented in the Mexican oil and gas industry. The new policy is having two effects: a reduction in CO2 emissions and a renewed interest in natural gas, a very important resource that is wasted when burned. We have the equipment and technology to take advantage of the gas that would be commonly flared in fields that lack the transportation infrastructure. Nuvoil has participated in bidding processes for these kinds of projects as we feel ready to tackle this opportunity. We won our first tender for a project in Cantarell aimed at preventing gas flaring that is to start in 2015.

Q: What opportunities do you foresee as more foreign companies enter the Mexican oil and gas industry?

A: The recent structural changes should serve up plenty of fresh opportunities, specifically in providing services for gas management and compression. Nuvoil will be participating in the construction and development of a jack-up compression platform that will begin operating by 2015. We are adjusting Nuvoil’s corporate structure in order to be able to comply with all the necessary requirements and certifications. Our aim is to prepare our staff for these conditions to successfully create partnerships that will enable us to manage projects in an integrated manner. Moving from being a service company to being an operator would also contribute to our growth. We already have the right people to accomplish this shift, although we will pursue a strategy based around and joint ventures.

Nuvoil is familiar with building partnerships. For example, we are currently working with Siemens, which provides turbines for our Cantarell project. We have also worked with Grupo México in the north, where we installed compressors to improve natural gas transportation. Other collaborations involve Valerus Compression, a company based in Houston, and several contracts with Petrofac.

Partnerships are a key factor in the company’s goal of becoming an operator. First, we will wait for the secondary laws to be issued to fully understand the rules of the game. Once this happens, we can begin establishing joint agreements with Mexican companies based on skills exchange, especially concerning drilling and production processes. Our main objective is to create a consortium of companies that can be managed as a whole and be able to compete with other operators in Mexico. By combining these factors, Nuvoil will become an even more important player in the Mexican oil and gas industry with proven competitive advantages in the market.