Ku-Maloob-Zaap: Offsetting the Decline at CantarellWed, 01/25/2012 - 11:33
Discovered in 1979, Ku-Maloob-Zaap (KMZ) became Pemex’s prime target for development in light of Cantarell’s decline, as KMZ contains 4.9 billion Boe, 18% of Mexico’s proven reserves excluding Cantarell, and is close enough to the Cantarell complex to share some infrastructure. KMZ is located offshore, 105km northeast from Ciudad del Carmen in Campeche. It has a water depth of 100m and is comprised of the Ku, Maloob, Zaap fields, as well as the smaller Bacab, Lum and Zazil-Ha fields.
At Cantarell, nitrogen injection proved extremely successful when applied following the field’s production decline. However, after nitrogen injection had done its work at Cantarell, Pemex decided that further injection could risk damaging productivity. The company therefore decided to divert nitrogen from Cantarell to KMZ in order to boost production. In 2002, production at KMZ stood at 249,300 bbl/day. The aim of the development plan was to reach a target of 800,000 bbl/day by 2011, but this target was actually reached in 2009. By December 2011, production at KMZ stood at 860,000 bbl/day, and was Pemex’s most productive field.
However, it is unclear how much longer the KMZ field will remain Pemex’s saviour with its high production. In 2010, Pemex indicated that KMZ was most likely entering its highest possible productivity rate, which would last some three years before beginning to decline. As demonstrated by the adjacent graph, Ku’s production started declining in 2008, Zaap reached its production plateau in 2009, and Maloob has been the main driver of production growth in recent years.
In 2011, Ku’s annual production rate declined 8.0% from an average 338,000 bbl/day to 292,000 bbl/day. By December 2011, production in Ku had dropped to 292,000 bbl/day. Over the same time period Zaap’s production rate increased 2.5%, rising from 274,000 bbbl/day to 280,000 bbl/day, confirming that the field’s production plateau is currently stable while its 289,000 bbl/day could be an indicator of further upward potential. Last year’s production increase was mainly driven by Maloob, which witnessed a 10% growth in production from 218,000 bbl/day to 243,000 bbl/day. By the end of last year, Maloob’s production already increased to 270,000 bbl/day, an upward trends that needs to be continued to balance Ku’s decline and sustain the overall production in Ku-Maloob-Zaap.
CNH President Juan Carlos Zepeda Molina gives some insight into what can be expected in the coming years. “The CNH’s 2012 technical assessment of Ku-Maloob- Zaap will examine whether production has in fact reached its peak at 860,000 bbl/day, and how the pressure is developing at the field. As Pemex continues pushing Maloob to increase production, one of the big concerns involving KMZ is the connectivity between the three fields, which are connected through an aquifer. This means that the pressure in some way is connected.
A pressure reduction at Ku means that Pemex will not be able to keep pushing production at Maloob or even keep Zaap at a stable level in the long-term. This is a complex topic that requires much more study, but the principle holds. We cannot push production much further at Maloob and Zaap, and the question is how long will Maloob and Zaap be able to sustain their current production level if Ku continues to decline, and what will happen if the decline of Ku starts to accelerate? Mexico’s production rate for the next five years will come down to this, and I am concerned that the production of the whole asset has been pushed above the originally intended levels of production and this could deliver negative effects in the coming years.”
However, Carlos Morales Gil, Director General of Pemex E&P, denies that the NOC has pushed production levels at the expense of recovery factors, saying that the decision had been taken to keep KMZ at a plateau of 850,000 bbl/ day, rather than ramping up production as far as it will go. In order to achieve this plateau, Morales Gil explains that Pemex is applying many of the same techniques that are being used to keep Cantarell from declining too quickly, including nitrogen injection, drilling wells to avoid water and gas production, replacing gas lift with electronic submergible pumps (ESPs), and measuring the productivity of every single well in the complex. “You can visit Cantarell and KMZ today and you will find the same technologies in both fields. The difference you will find between the two fields is one of policy, not of technology,” says Morales Gil.
With Cantarell on the path to extinction, it could be that over-reliance on KMZ could lead to the same problems that the company faced once it was clear that Cantarell was on the decline, but for the next few years at least, KMZ will continue to be the lynchpin of Pemex’s production strategy.