Key Technological Changes

Wed, 01/25/2012 - 10:56

In the years to come, Pemex must deal with the challenges of optimizing long-term production at Cantarell, Ku-Maloob-Zaap and other mature fields, overcoming production challenges in fields with complex geologies such as Chicontepec, and developing new fields in areas where the company has little operational experience.

Challenge 1:

Mature fields Pemex faces the challenge of technological obsolescence in its shallow water oshore fields such as Cantarell, once relied on for such a large percentage of the company’s annual production. Some of the problems at Cantarell have already been successfully tackled. Since 2000, Pemex has been using nitrogen injection to combat a drop in reservoir pressure exceeding 60%, which led to production dropping to 25% of previous levels. Nitrogen injection was successfully chosen as the technique to resolve this issue over water injection, which may have aected productivity at other wells in the basin due to its fractures and fault systems. Reservoir pressure was restored, but in 2004 Cantarell reached its production peak, after which production began to decline at a rate of 4.7% in 2005, 11.5% in 2006, 17.2% in 2007, 30.3% in 2008, 34.2% in 2009, and 22.6% in 2010.

A number of dierent technologies have been applied to slow the decline of the Cantarell field, such as reservoir management solutions, optimized drilling techniques, intelligent wells, well interventions and workovers, and remote field management systems amongst other solutions.

Figures released by the National Hydrocarbons Commission (CNH) indicate that oil production in Cantarell dropped from 558,000 bbl/day in 2010 to 449,000 bbl/day in 2011. This 19.5% decrease indicates that the production decline is being slowed down, but the continuing decline, Cantarell’s January 2012 production reached only 404,000 bbl/day, illustrates that production has yet to stabilize and various technological challenges remain to be addressed.

In the years to come, many new enhanced oil recovery technologies will be examined by Pemex, particularly as it now seems likely that Ku-Maloob-Zaap will begin to enter its decline phase in the coming years.

Challenge 2: Geologically challenging fields

Chicontepec is arguably Mexico’s most technologically demanding basin. Located onshore, the basin is over 3800km2 and spans across the states of Veracruz, Puebla and Hidalgo. Accounting for 56% of Mexico’s 3P reserves according to Pemex, for the last few years Chicontepec has understandably been a lynchpin in Pemex’s exploration strategy. However, in April 2010 the Chicontepec development project came under heavy criticism by the upstream watchdog CNH, which called for a reassessment of the project.

Re-examination of the strategy stems from the fact that the complexity of Chicontepec’s geology made the initially applied reservoir data collection, drilling, and production technologies less eective than originally anticipated. The reserves held in the basin are located in very small pockets, which make it dicult to maintain well pressure for long periods of time. Chicontepec will require a number of dierent technologies if Pemex wishes to optimize the exploitation of the reserves. These would include 3D seismic for further exploration, as well as characterization of the fracture systems in the geology. Pemex will also have to employ horizontal and multilateral drilling techniques if it wants to find a more eective way to exploit its reserves than the previous approach that was halted by the CNH’s critiques. In order to manage production, Pemex will have to investigate the use of water production management and disposal, as well as artificial lift systems. Later in the life of Chicontepec wells, Pemex may also have to look at processes that can boost secondary recovery, such as water flood programmes, thermal methods, chemical processes, and CO2 injection.

Challenge 3: New Frontiers

As well as dealing with its production problems at existing fields, Pemex is increasing its exploration activity in new areas. Pemex’s deepwater assets are seen by many as one of the best opportunities for increasing the country’s oil reserves and safeguarding Mexico’s long-term oil production. However, the NOC has yet to discover any commercially viable oil reserves in deepwater. Until this happens, deepwater development will progress slowly. In the meantime, Pemex must deal with preparing itself for the day when oil is discovered in deepwater. Prior to beginning deepwater production, any company must solve the problems resulting from operating in increased water depth, high pressures, low temperatures, a harsher oshore environment, and the installation and maintenance of oshore production solutions.

The way forward

There are three options for Pemex to tackle such imposing technological hurdles. The first is with solutions that can be developed in-house by Pemex. The second option is working with Pemex’s R&D vehicle, the Mexican Petroleum Institute (IMP), and the research institutes under Conacyt (National Council of Science and Technology). In other areas, though, Pemex will be forced to rely on international oil companies and oilfield service companies to bring their technology to Mexico to tackle technological challenges, ranging from setting up deepwater production to taking on some of the biggest enhanced oil recovery challenges that Mexico’s fields have to oer