PEMEX Makes Savings and Awards ContractBy Peter Appleby | Thu, 09/03/2020 - 15:30
After a week when hurricanes Laura and Marco caused major shutdowns across the Gulf of Mexico, PEMEX has reported good news. President Andrés Manuel López Obrador said the company has made over US$1 billion in savings, while it has also handed out a multi-million dollar contract to a drilling firm as it continues its quest to increase production, which has dropped to the lowest point since October 1979. But amid this progress, questions about PEMEX’s green values have surfaced with shareholders suggesting the company may need to change its tact if it is to continue attracting private investment, something it cannot live without.
All this and more in the Week in Oil and Gas!
Even before COVID-19’s arrival, oil and gas majors had accepted the need to make their operations more sustainable. Though the globe needs an increasing amount of energy, environmental circumstances mean that cleaner ways to produce it must be found. But the price plunge and demand destruction that swiftly followed the pandemic have taken reserves off the table and given force to the voice of shareholders that demand a greener future for oil and gas. Many more companies now look to becoming greener.
PEMEX is one of the few companies not heeding the call and the major shareholder groups that back the indebted company are questioning the rationalization behind the NOC’s stubbornness. As shareholders point out, by not improving its environmental policies, PEMEX is reducing its attractiveness and making it harder for major shareholders to invest as they themselves push towards sustainability.
With PEMEX’s health linked so intimately to the health of the Mexican economy, this is a direction that company management and government alike should reconsider soon.
PEP Has Saved Over US$1 Billion, Says AMLO
President Andrés Manuel López Obrador said in his State of the Nation address that PEMEX E&P has saved some MX$24 billion (US$1.1 billion) during the rollout of service contracts for the company’s 20 priority fields.
According to El Financiero, PEMEX has registered average savings of 26 percent across contracts, with President López Obrador saying that the company’s use of existing infrastructure has helped make the savings. The State of the Nation address says that savings have been made “since infrastructure built by Pemex in previous years is to be used because the 20 new developments are near pipelines, separation batteries and/or processing centers that are currently underutilized as the production of crude has fallen more than 40 percent against 2008.”
The savings will be useful for PEMEX which racked up record losses during the year’s first quarter. So far, priority fields have been delayed in development but PEMEX needs to push ahead if it is to meet its goals of expanding its resources and increasing production, which in July fell to its lowest levels since October 1979.
PEMEX has awarded Dolphin Drilling, a drilling rig company headquartered in Aberdeen, an US$83 million contract for the use of its Blackford Dolphin rig over a 15-month period in the Gulf of Mexico.
“(The company’s) ability to mobilize the asset quickly and our excellent operational and safety performance were key to us winning the contract. Blackford Dolphin is one of the most efficient moored semisubmersibles in the market, providing a reduction of CO2 emissions associated with drilling due to its low fuel consumption and high drilling performance,” said Dolphin Drilling.
According to RigZone, the Blackford Dolphin was completely rebuilt in 2008 and includes a sixth-generation topside. It is able to operate in water depths of 70m to 1,700m when moored.
“Our alliance with PEMEX demonstrates how we can add value to operators located anywhere in the world,” said CEO Bjørnar Iversen. “I am looking forward to us continuing our global growth in the years to come and see Mexico as a strategically important market for our moored semisubmersible.”