Lack of Jack-Up Platforms Hits Private Production
Carlos Morales, CEO, PetroBal, told Bloomberg Línea that the industry’s lacking supply of jack-up platforms has affected the company’s operations regarding its Ichalkil and Pokoch work programs.
The situation has affected both PetroBal and its partner Fieldwood Energy. The companies form a significant part of Mexico’s decline in private production since August 2022: Up until October 2022, Fieldwood Energy and Petrobal reported a 27 percent decrease in production at the Ichalkil and Pokoch fields compared to September 2022. This affected private production numbers since 80% of private production is carried out by Eni, Fieldwood and Hokchi.
President Andrés Manuel López Obrador set a goal for private companies to produce 280Mb/d with the Mexican Association of Hydrocarbon Companies (AMEXHI), which projected the production of 209Mb/d for 2022, yet so far the current production estimation has stayed at approximately 49 percent below this goal, with 105Mb/d.
Fieldwood Energy announced that it plans to add 7Mb/d by putting another one of its wells under repair online. The company also plans to drill more wells at the Ichalkil field.
The demand for jack-up rigs increased from 75% to 95% in 2023. According to S&P, the usage in the US of these platforms is at 82.8%, while in South America the figure stands at 100%.
Private Oil Investment Is Still Stalled
Private E&P investment increased by 5.08% from December 2022 to January 2023. This amounts to US$13.360 billion, with a US$646 million month-over-month increase.
Private investment suffered its biggest fall in September 2022 when it increased only 0.56% and it appears it has not been able to recover to previous levels.
Oil investments plummeted in 2022 to US$1.621 billion, the lowest level in four years. Despite the increase in crude oil prices, both PEMEX and private players invested fewer resources in the exploration and development of oil and gas fields.
Furthermore, many E&P activities were abandoned in 2022. Although CNH has assured that companies deciding to focus on more profitable areas is a normal process, no further bidding rounds have been granted during this administration, which is further stalling investment.