PEMEX Launching Tenders for Ixachi, Quesqui

PEMEX announced it was launching new tenders this week for the leasing of drilling rigs at the priority Ixachi and Quesqui fields. In recent months, Ixachi and Quesqui, discovered in 2017 and 2019 respectively, have picked up the slack from underperforming mature fields, adding a combined 54Mb/d by the end of 1Q22.

"Interested parties are invited to participate in the international electronic open bids with set deadlines under the free trade agreements signed by the United Mexican States for contract PEP-CAT-A-GCSEYP-100-94537-22-11," the announcement of the international public bid read.

The objective of the public bid is to lease, without the option to buy, onshore drilling equipment with a minimum capacity of 589,670kg and 3000HP. The contract is valid for 565 days from June 15, 2022 to Dec. 31, 2023.The published call for bids stated that doubts regarding the terms and conditions will be addressed at an event on May 17. The presentation and opening of proposals will then take place on June 13. A winner will be announced on June 20. The NOC informed that the bidding process will follow its new system for electronic contracting, SISCeP.

This news comes after the CNH announced that PEMEX could face sanctions for irregularities regarding the management of the Ixachi field. The Ixachi field, located 26km northeast of Tierra Blanca and 72km kilometers south of Heroica de Veracruz, has a total area of 740.55km², with 8 wells drilled and a total production of 24.7Mb/d barrels. 

While both PEMEX and the energy ministry refused to comment on the ongoing investigation, Reuters sources suggested the fine is related to excessive flaring of natural gas. NASA satellite images provided to Reuters indicated that PEMEX flared 24.9Bcf of gas in the area last year, making Ixachi now the 10th largest flaring site in the world. This time last year, Ixachi was not even in the top 1,000 list of worst offenders. Despite being a major contributor to greenhouse gas emissions, flaring is not technically illegal in Mexico in situations when gas is encountered next to oil deposits. However, energy companies must abide by strict limits set by CNH. 

Furthermore, according to the government regulator, companies are not permitted to flare gas when they have committed to producing it, and PEMEX have been accused of wasting the valuable resource which made up a third of Ixachi’s total value upon its discovery in 2017. PEMEX had previously stated to investors that reducing flaring was a top priority. The NOC cites a need to maintain and refurbish its gas processing centers, particularly missing infrastructure in the case of Ixachi, as one of the main reasons gas is released into the atmosphere. Ixachi still lacks crucial infrastructure to commercialize the abundant gas reserves, and heavy machinery has only just started clearing dense vegetation to allow for further construction. 

Last June, CNH authorized PEMEX to perform wellhead measurements at predetermined dates as well as a pressure and production test for the duration of 12 months, with the purpose of improving the understanding of the reservoir in its Cretaceous horizon. The regulator granted PEMEX further permission last week to modify this transition program for the Ixachi-2001EXP well, with the goal of providing continuity to the field's production. The NOC requested the modification to give it more time to complete the wellhead monitoring tasks. So far, PEMEX has recovered 1.15MMboe and 9.04Bcf of natural gas. The total cost of the program sits at US$6.33 million dollars, of which US$5.85 goes towards operating expenses while US$479 thousand has been set aside for infrastructure investment.