PEMEX Flared US$342 million of Resources at Ixachi, Quesqui

According to documents gathered by Reuters, PEMEX flared hydrocarbon resources worth US$342 million. The NOC burned off natural gas and condensate at the Ixachi and Quesqui fields. Over three years, US$275 million worth of resources were destroyed at Ixachi, while another US$67 million were wasted at Quesqui in two years.

According to the source, 31% of Ixachi’s gas production is lost to flaring. Of the original investment for Ixachi in PEMEX’s original development plan, 77.6% was never made. The field therefore lacks the infrastructure to efficiently capture the gas, which means burning is the only option to prevent it from leaking into the atmosphere.

PEMEX’s lack of gas infrastructure appears to be linked to this administration’s ambitious goals to meet oil production targets. Energy self-sufficiency was a flagship of President López Obrador’s presidential campaign but PEMEX’s deficient historical investment levels, added to massive debt, have made it difficult to achieve the desired numbers.

According to former CNH commissioner Sergio Pimentel, the NOC has put its production objectives above all else, which might also damage the fields and cause an early production decline. PEMEX has exploited its fields this way for many decades, Pimentel said. The company has not invested in the necessary infrastructure because it does not consider natural gas to be a profitable resource, prioritizing the extraction of crude oil and condensates instead.

In December 2022, PEMEX announced that it would stop flaring at the Ixachi field in 2023. By December 15, 2022, the Papan Measurement and Control Station (EMC) would be able to process 150MMcf and by January 15, 2023, its capacity would increase to 300MMcf, thereby avoiding flaring altogether. No Information on the progress of this measure has been made available yet, however.

PEMEX has been widely criticized for excessive flaring and causing environmental harm. After facing backlash because of its environmental practices and amid an upcoming COP27, PEMEX made several announcements over the last months of 2022. In these messages, the state oil company said it would be doubling its efforts to implement a more environmentally-friendly operational strategy.

Toward the end of 2022, PEMEX revealed d its 2023-2027 Business Plan, including the NOC’s latest environmental commitments as well as the strategies it plans to follow to make optimal use of oil and gas resources.

PEMEX also stated that it plans to increase gas capture in 2024: it will invest US$3.78 billion to increase the share of natural gas it captures to 98 percent.