Looking to the Long Term for Mexico's Oil Industry

Q: How has the boom in available multiclient seismic data impacted PEMEX’s exploration strategy?

A: PEMEX made important investments acquiring 2D and 3D seismic data, which was of course bound to the capital approved by the government. One of the most important activities was represented by the seismic campaign from 2010 to 2015 in which PEMEX got around 100,000km2 of 3D seismic, out of which 30 percent is wide azimuth, allowing PEMEX to understand the zones with high-salt complexity in the Perdido area. Those 30,000km2 led to the Trion discovery in 2012, turning it into the first oil reservoir in ultradeep Mexican waters ever discovered. But that was not the only discovery brought by that 3D seismic survey because the gathered information was also used for the bidding of Blocks 1, 3 and 4 in Round 1.4. A more indepth study of the data also led us to discover the Doctus reservoir last year.

In the north, we are acquiring a new 3D survey to turn the wide azimuth seismic we already have into a multi azimuth, therefore improving the images under the salt. So far all of these studies have been acquired by PEMEX, but we are also entering the multiclient scheme with an eye on evolving together. Through these actions, PEMEX expects to offer a higher value in those areas.

The 3D wide azimuth allowed us to see the Doctus opportunity last year, which has around 150 million boe. Nobilis is another extremely attractive discovery as it has the thickest pay we have ever found in deepwater and contains 43° API oil. We are also drilling the Nobilis-101 to test and adjacent structure to the north. It is a challenging project because these discoveries are located in a water depth of around 3,000m, but following the results we had with Trion and considering that Nobilis contains super light oil, we are confident the Nobilis-Maximino farm-out will be a success. Both projects, Trion and Nobilis-Maximino, may create synergies to make prospects and the region more attractive for international companies.

Q: How is PEMEX working to increase the amount of reserves in Mexican territory?

A: Last year PEMEX discovered more than 1 billion boe in resources but of that only around 680 million boe could be considered possible reserves, leaving the rest as contingent resources because they contain a lot of gas and are currently uneconomic. Even though they cannot be considered reserves, we know the resources are there and, by applying proper technology, processes and increasing efficiency, those resources may in the future turn into reserves. It is a slow process but we see those possible reserves discovered turning into probable and eventually into proven reserves in the future.

Trion and Nobilis-Maximino are both exploration and appraisal projects that could turn relatively fast into development projects. Doing a farm-out of an exploration area or a discovery has the advantage of sharing the risk with another company, as well as accelerating activities by joining forces to move the project to appraisal and/or development. In deepwaters, we only have possible reserves and it may take several years to appraise the discovery and then sanction a development project in order to get probable and proven reserves. To ensure the integration of more probable and proven reserves in the short-term, PEMEX is focusing onshore and in shallow water, where the process usually faster and takes between two and four years.

Q: What ambitions does PEMEX E&P have for next year?

A: If we drill the 30 wells we have in mind for 2017 we can reach 1 billion boe, meaning that PEMEX will be aligned to its Business Plan in which the base scenario is around 1.1 billion boe with an investment of MX$33 billion. Our work is focused on capturing the value of the Round Zero acreage to meet this goal in the short term and accessing new areas in bidding rounds to replace reserves in the medium and long terms. PEMEX is looking to take full advantage of all the opportunities resulting from the Energy Reform.